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The neo-classical view The neo-classical view is that market forces are the best directors of the economy. Positive attempts by the government it is argued inevitably make th
Structural unemployment Caused by structural changes such that there exist: Cyclical unemployment : During depression, prices are too low and profit margins remain d
Convertible National Currencies Currencies are convertible when holders can freely exchange them for other currencies. There are several advantages in using a particular natio
Suppose that the government is the only provider of water. The market demand function reads D: Q(P) = 50 - 2P. The government''s total cost for producing water are described as fol
MONOPOLISTIC PRACTICES The following practices may be said to characterize monopolies. Exclusive dealing to supply and collective boycott Producers agree to supply onl
Problem 1: All economies of the world can be said to be ‘mixed', to a greater or lesser degree, in that there is no economy where there is no state activity and no economy wher
Increase in demand SS is the supply curve and D 1 D 1 the initial demand curve shifts to the right, to position D 2 D 2 . P 1 is the initial equilibrium price and q 1
Policies to cure Balance of Payment deficits The measures available to tackle balance of payments deficits include short term measures such as deflation, import controls, dev
Price Elasticity of Supply Price Elasticity of supply measures the degree of responsiveness of quantity supplied to changes in price. The co-efficient of the elasticity of s
Milton Friedman makes the demand for money a function of the real per capital permanent income. in this study the demand function for money is stated as; M/NPP= r( YP/NP) δ W
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