1) The government decides to lower regulations on industry and as a result cost will fall and output increase, but the changes require public review and thus will not go into effect until next year. ( assume there is no uncertainty about their being implemented, but there will be a delay)

2) The government decides to expand the Interstate highway system at a current cost of 5 million dollars, but this is a “productive” project since it will yield 20 million dollars worth of savings in delivery cost of goods in the future. ( assume the result is a 20 million increase in future output)

3) How would your answers to (2) change if some of the repairs were immediate repairs in potholes and uneven parts of the system. As a result there is an short term reduction in costs of 3 million now (and corresponding increase in output), and only 10 million in cost savings in the future.

4) How would your answer change of the costs were 5 million now, 5 million in the future, while the savings were 10 million in each period.

5) Suppose instead of highway construction the program in question were a social program. The administrative costs are 5 million dollars for setup, but 20 million dollars of food will go to students in low income school districts.

6) What happens when expected inflation increase?

[此贴子已经被作者于2007-2-17 17:29:17编辑过]