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Neo Classical vs Keynesian School We know that Keynesian economics was propounded as a revolution against the then prevailing orthodoxy of the classical school. In time,
WASTE IN IMPERFECT COMPETITION Monopolistic competition involves some degree of waste in two aspects. When new firms enter the industry and the demand for the individual fi
What is Normative economics It is concerned with varied corrective measures which a management undertakes under different circumstances. It deals with goaldevelopment, goal det
Model Specification We proceed with the model specification in the following steps. 1) The economy is composed of competitive firms (F in number) and identical workers
Mankiw Model of Nominal Rigidities There are two related reasons for which firms do not frequently change prices. First, as we saw in the discussion on menu costs, the cost
NATIONAL INCOME AND WELFARE The relationship between National Income and Welfare is best explained in terms of economic growth (By economic growth is meant capacity expansio
Causes of Inflation At present three main explanations are put forward: cost-push, demand-pull, and monetary. Cost-push inflation occurs when he increasing costs of prod
what is the uses of production functns?
PER CAPITA INCOME AND INTERNATIONAL COMPARISONS Per capita income figures can also be used to compare the standards of living of different countries. Thus if the per capita in
Transitional unemployment Transitional unemployment is that situation which prevails due to some temporary reasons. The main reason for this type of unemployment are:
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