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Official Reserve Account:This part of the balance of payments informs us about how the balance of both current and capital accounts taken together is settled.Transaction in this section is called accommodating transaction. They are accommodating transaction because the funds are to make the balance of payments balance. When the net balance on the current and capital accounts is in deficit, the deficit must be settled with an equal net credit in the official reserve account. If on the other hand, a country has a surplus, the surplus must be used up to balance the balance of payments.
Consider a non-renewable resource. There are two periods, now and later. The demand curve in each period (t = 1, 2) is Qt = 10 - Pt. The stock of the resource is 10 units. Extracti
WHAT ARE THE PRACTICAL IMPORTANCE OF INCOME ELASTICITY OF DEMAND?
baumol''s theory
1) A) Suppose that several months of data showed the CPI increasing at a 4.5% annual rate due largely to increases in the price of energy and food related commodities following sev
using necessary and sufficient conditions explain consumer equilibrium diagrammatically as well as mathematically
Change in the price of a related good: Goods relate to each other in two ways. Goods are either complements or substitutes. Complementary goods are goods with joint demand. The
The Effects of Advertising on the Demand Curve: Advertising targets to: • Change the slope of the demand curve which means make it more inelastic. This is done by generat
You are examining the effects of a specific tax of 10 cents imposed on the sales of a product that we shall call XYZ. To carry out your analysis, assume that the market is a perfec
what is the theory of second best?prove the theorm with the help of diagram?
Directions: You should legibly handwrite or type the answers to the following questions on a separate sheet of paper. These must be submitted in class (not via email unless you hav
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