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Why does a price index based on constant weights tend to overstate inflation in periods after the base year when the price of one good is rising quickly compared to other goods?
Because people tend to buy cheaper substitutes instead of the good whose price is quickly increasing. But the constant-weight index includes the similar quantities of the expensive goods.
what do you understand by production posibility curve?
1. Suppose the banking system has reserve of $750000, demand deposits of $2500000 and a reserve requirement of 20%. a. if the fed now purchases $125,000 worth of govt bonds from t
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LANTHENOIDS
Arbitrage pricing theory is between one of two influential economic theories of how assets are formed or priced in the financial markets and the other model is the capital asset pr
Determinants of Private Demand - Gender Hypothetically, let us consider a family with two children, a boy and a girl. Let it be that both of them qualify in an entrance exami
if a monopolist makes economic profits, new firms enter the market and compete with the monopolist in the long run.
So what caused the end of Malthusian age? How did humanity escape from the trap in that invention and ingenuity increased the numbers though not the material well-being of humanity
What is the difference between 'scarcity' and 'shortage'? 'Scarcity' and 'shortage' have dissimilar definitions. In reality, when most of the goods and resources are scarce go
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