Last year, while an economy was in a recession, government spending was $595 billion and government revenue was $505 billion. economists estimate that if the economy had been at its full-employment level of gdp last year, government spending would have been $555 billion and government revenue would have been $550 billion. which of the following statements about this government’s fiscal situation are true? lo3 a. the government has a non–cyclically adjusted budget deficit of $595 billion. b. the government has a non–cyclically adjusted budget deficit of $90 billion. c. the government has a non–cyclically adjusted budget surplus of $90 billion. d. the government has a cyclically adjusted budget deficit of $555 billion. e. the government has a cyclically adjusted budget deficit of $5 billion. f. the government has a cyclically adjusted budget surplus of $5 billion

Suppose that two firms produce differentiated products and compete in prices. as in class, the two firms are located at two ends of a line one mile apart. consumers are evenly distributed along the line. the firms have identical marginal cost, $60. firm b produces a product with value $110 to consumers.firm a (located at 0 on the unit line) produces a higher quality product with value $120 to consumers. the cost of travel are directly related to the distance a consumer travels to purchase a good. if a consumerhas to travel a mile to purchase a good, the incur a cost of $20. if they have to travel x fraction of a mile, they incur a cost of $20x. (a) write down the expressions for how much a consumer at location d would value the products sold by firms a and b, if they set prices p_{a} and p_{b} ? (b) based on your expressions in (a), how much will be demanded from each firm if prices p_{a} and p_{b} are set? (c) what are the nash equilibrium prices?