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When there is a positive expected rate of inflation (i.e., an expected and sustained increase in the levels of all prices), the Benefit Cost Ratio of a proposed project will take on different values depending upon whether one calculates it using current dollars or constant dollars.
Define
what are current dollars ?
The income elasticity of demand calculates the responsiveness of the quantity demanded of a commodity to changes in consumers' incomes. This is typically calculated by replacing t
what is mrs
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discuss how economic theory of marginal utility explains the optimum pattern of consumption for an individual consumer
Xd(Px)=5000-100Px
Suppose the price of books is $15, the price of movies is $5, and your income is $75. Assuming you have a desire to reach constrained optimization, how many movies will you buy? Ho
limitations
The Equilibrium Consumption Combination equilibrium for the person occurs at the point where the indifference curve, shown by II, is tangent to the budget line, portrayed by BB. T
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