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Problem :
(a) Describe inflation and discuss its origin using Classical and Keynesian theories.
(b) Describe with diagram how can inflation occur in an economy with substantial unemployment of factors of production.
(c) Comment on the effects of inflation in the economy and the measures to control the inflation.
Income elasticity of demand The income elasticity of demand measures the degree of responsiveness of the quantity demanded of a product to changes in income. Its co-efficient
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Other Determinants 1. Rate of Interest Is contained in the argument of the classified economists who argued that rational consumers will save more and consume les
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Why Do Monopolies Exist? Monopolists have market power and as a consequence will charges higher prices and generate less output than a competitive industry. It produces profit
The Firm The unit that uses factors of production to produce commodities then it sells either to other firms, to household, or to central authorities. The firm is thus the uni
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