This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Everything else equal, how will a decrease in the interest rate in Mexico affect Mexico's GDP? ... (Read 49 times)

armygirl

  • Hero Member
  • *****
  • Posts: 556
on: Jun 30, 2018
Everything else equal, how will a decrease in the interest rate in Mexico affect Mexico's GDP?
 
  What will be an ideal response?

Question 2

A firm's inventory piled up during a recession. How will its labor demand be affected when its excess inventory gets sold off eventually?
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Awesome

  • Sr. Member
  • ****
  • Posts: 280
Reply #1 on: Jun 30, 2018
Answer to Question 1

A decrease in the interest rate in Mexico will cause a decrease in the willingness to invest in Mexico. This will cause a fall in the demand for pesos and cause it to depreciate. A depreciation of the peso will encourage exports and discourage imports causing net exports from Mexico to rise. This will cause an increase in the GDP of Mexico.

Answer to Question 2

The firm will increase its production after its excess inventory gets sold off after the recession. An increase in production will lead to an increase in its demand for labor. As a result, the firm's labor demand curve will shift to the right.


armygirl

  • Member
  • Posts: 556
Reply 2 on: Jun 30, 2018
Wow, this really help

lkanara2

  • Member
  • Posts: 329
Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

« previous next »
 

Did you know?

Hip fractures are the most serious consequences of osteoporosis. The incidence of hip fractures increases with each decade among patients in their 60s to patients in their 90s for both women and men of all populations. Men and women older than 80 years of age show the highest incidence of hip fractures.

Did you know?

There are 60,000 miles of blood vessels in every adult human.

Did you know?

Acetaminophen (Tylenol) in overdose can seriously damage the liver. It should never be taken by people who use alcohol heavily; it can result in severe liver damage and even a condition requiring a liver transplant.

Did you know?

According to the American College of Allergy, Asthma & Immunology, more than 50 million Americans have some kind of food allergy. Food allergies affect between 4 and 6% of children, and 4% of adults, according to the CDC. The most common food allergies include shellfish, peanuts, walnuts, fish, eggs, milk, and soy.

Did you know?

The average adult has about 21 square feet of skin.

Rate of Residential Change, Past Year, in the United States Rate of Residential Change, Past Year, in the United States
Failure of the Equal Rights Amendment, 1972–1982 Failure of the Equal Rights Amendment, 1972–1982
Rising sea levels will affect millions in coastal zones and on islands Rising sea levels will affect millions in coastal zones and on islands
How much the temperature will rise depends on many factors that affect the level of GHG emission How much the temperature will rise depends on many factors that affect the level of GHG emission
Genes, hormones, and activity affect weight Genes, hormones, and activity affect weight
Planet Z-34 has a mass equal to 1/3 that of Earth, a radius equal to 1/3 that of Earth, and an ... Planet Z-34 has a mass equal to 1/3 that of Earth, a radius equal to 1/3 that of Earth, and an ...
Video: Carpal Tunnel Syndrome

For a complete list of videos, visit our video library