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MONEY AND CREDIT In any modern economy, the quantity of money, aggregate volume of credit and its sectoral composition are important variables which exert significant influenc
discuss modern theory of determination of rent?
Whenever real GDP declines, nominal GDP must also decline
What are the advantages of leaving resource allocation to price allocation? Ans) The 5 benefits are Neutral, Flexible, Freedom of choice, No administrative cost and lastly Dimin
Define the monopoly of Central banks The central bank has a monopoly on issuing currency, it is in complete control of the monetary base. In section 7.4.2 we will describe exac
Explain the difference between productive and allocative ( economic ) efficiency. Explanation of productive efficiency, e.g. output at AC minimum Define to the effect th
Q. Explain the labor market in the cross model? In cross model, both P and W are exogenous andconstant. Hence real wage is constant and it is not essentially equal to the equil
How can achieve mutual gain from international trade?
Note that it's changes in prices during 2008 that matter for the high real interest rate (time period when your deposit is earning interest). This means that you can never know how
THE PRODUCT MARKET Z=C+I+G C=a+bYd I=Io+I1Y-I2i Equilibrium condition, Y=Z, where Y represents output and Z is aggregate spending. THE FINANCIAL MARKET Md=MT+Mp MT=MTo+MT1Y Mp=Mpo
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