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Describe how price level evolves over time
Using the time series we can study how price level evolves over time. If all prices rose by 2% during one month, price level would rise by exactly 2%. If one of the prices rose by 2% when other prices remained unchanged, price level would rise though by much less than 2%. Exactly how much it would rise would rely on the weight of changed price.
The aggregate demand curve shows the combinations of the price level and the level of output at which the goods and money markets are simultaneously in equilibrium. Let us now go o
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Why a perfectly competitive retail market is more competitive than a monopoly
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