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Question 1:
(a) Using examples, explain how the theory of Purchasing Power Parity conforms to the Law of One Price.(b) According to you, how best does the Theory of Purchasing Power Parity explain exchange rates?(c) What are the factors influencing exchange rates in the long run?
Question 2:
The main difference between Federal Reserve System and other government agencies in the United States is its independence.
Describe why the Central Bank is expected to be more independent.
Private benefit and social benefit: Bridge the gab between private cost and social cost, and private benefit and social benefit.Under perfect market, there may be a divergence
Fiscal Policy Fiscal policy refers to the management of government spending and tax policies to influence total desired spending so as to achieve the desired level of economic
Arbitrage pricing theory is between one of two influential economic theories of how assets are formed or priced in the financial markets and the other model is the capital asset pr
Why firm charges different prices to different consumer? Every firm needs to maximize its profit. When goods are sold to different customers, each customer negotiate price of
What is the theory of Second Best? Prove the theorem with the help of a diagram.
What is equilibrium point
1. Assume that the market for wheat is perfectly competitive. Suppose the demand curve for wheat is given by: QD = 200 – 2P where QD is the quantity demanded, in bushels, and P i
to what extent are interest rates determined by the economic theory
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periodic table
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