Q1. Explain how immigration between two countries could be an equalizer of wages and economical for both sending and receiving countries. Relate the question to Mexico and the United States of America and use a graph to explain. Discuss the challenges of applying the theoretical concept into practice in the short-term and long-term.
Q2. Suppose the consumption function is C = $400 billion + 0.9Y and the government wants to stimulate the economy. By how much will aggregate demand at current prices shift initially before multiplier effects?