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Consumer Equilibrium
To demonstrate the consumer's equilibrium i.e. the point at which the consumer maximizes utility with a given budget, we need to combine the indifference map and the budget line.
The consumer obtains maximum utility from a budget of AF by choosing the combination of X and Y represented by C, where the marginal rate of substitution is equal to the relative prices of X and Y.
Organization for Economic Development (OECD) An international organization found in Paris France in 1961, to act as a worldwide forum to stimulate world trade and
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Thinking about modifications in the model again: Go back to the original model again, but add a marginal propensity to invest, this is, suppose that I = f ( i and Y). The MPI is d
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