Examine the Following Data for a Hypothetical Centrally Planned Economy

question 130

Essay

Examine the following data for a hypothetical centrally planned economy that subsequently frees prices: (A)Assume that higher education and cereal are the only goods and services produced in this economy. Calculate GDP under the controlled prices and under market prices, assuming the quantities do not change. Did government-set prices result in an under- or overvaluation of production on the whole?
(B)How do people value each good in relation to previously controlled prices?

Differentiate between assignment and delegation of contractual rights and duties.

Recognize the conditions under which contractual obligations can be legally delegated.

Explain the effect of oral assignments and the requirements for their validity.

Understand the role and rights of a third-party beneficiary in contract law.

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Definitions:

Open Market Purchase

A monetary policy tool where the central bank buys government securities from the market in order to expand the money supply.

Money Supply

The total financial assets present within an economy, inclusive of cash, coins, and the amounts present in checking and savings accounts, at a certain point.

Reserve Requirement Ratio

The fraction of deposits that banks are required to hold in reserve, either in their vaults or with the central bank, not used for loans.

Checkable Deposits

Deposits in bank accounts that can be withdrawn using checks, debit cards, or digital transactions, comprising a significant part of the money supply.