Model of the Large Open Economy a. Major improvements in computer information technology in the 1990s fueled an increase in investment demand in the United States (a large open economy). Graphically illustrate the effect of an increase of U. S. investment using the Large Open Economy Model developed in the appendix of Ch. 6 (Hint: In your model you will need to draw three diagrams). Clearly label the axes and curves in each of your graphs in the model. Clearly indicate the direction of any shifts in the curves. In your model, label the initial equilibrium points as Point A and label the new equilibrium points as Point B.
b. Using your model drawn in Part (a), indicate what effect the increase in investment will have on the following economic variables in the United States:
(i) real interest rate,
(ii) net capital outflow,
(iii) real exchange rate,
(iv) net exports.

Exercise 18-15 sheffield appliance center is an experienced home appliance dealer. sheffield appliance center also offers a number of services for the home appliances that it sells. assume that sheffield appliance center sells ovens on a standalone basis. sheffield appliance center also sells installation services and maintenance services for ovens. however, sheffield appliance center does not offer installation or maintenance services to customers who buy ovens from other vendors. pricing for ovens is as follows. oven only $790 oven with installation service 850 oven with maintenance services 970 oven with installation and maintenance services 990 in each instance in which maintenance services are provided, the maintenance service is separately priced within the arrangement at $180. additionally, the incremental amount charged by sheffield appliance center for installation approximates the amount charged by independent third parties. ovens are sold subject to a general right of return. if a customer purchases an oven with installation and/or maintenance services, in the event sheffield appliance center does not complete the service satisfactorily, the customer is only entitled to a refund of the portion of the fee that exceeds $790. assume that a customer purchases an oven with both installation and maintenance services for $990. (b) indicate the amount of revenue that should be allocated to the oven, the installation, and to the maintenance contract.

Abank provides its customers mobile applications that significantly simplify traditional banking activities. for example, a customer can use a smartphone to take a picture of a check and electronically deposit into an account. this unique service demonstrates the bank’s desire to practice which one of porter’s strategies?

Your dormitory, griffingate, has appointed you central banker of its economy, which deals in the currency of wizcoins. assume that the velocity of wizcoins in griffingate is constant at 10,000 transactions per year. right now, real gdp is 1,000 wizcoins, and there are 2,000 wizcoins in existence.