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Q. Explain why one can write the demand for money as follows: Md = P L (R, Y)
Answer: The collective money demand is proportional to the price level. Imagine that every prices in an economy doubled except the interest rate and everyone's real incomes remained unchanged. After that the money value of each individual's average daily transactions would then simply double the same as would the amount of money each wishes to hold.
discuss the superiority of haberler''s theory of opportuinity cost over mill''s theory reciprocal demand?
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Q. Factor-intensity reversals define a situation in which the production of a product can be land-intensive in one country, and relatively labor intensive in another ( at given re
suppose that France has a trade surplus with the united kingdom, what would you expect to happen to price,wages, and commodity price in France? why? what would happen to the terms
Q. Use a figure to study the effects of a change in market belief with regard to the fixed exchange rate, in particular assume market participants expect the government to devaluat
Opportunity cost theory
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Q. Should the IMF be abolished? Discuss. Answer: Arguments for eliminating the IMF must mention moral hazard and insistence on high interest rates and hasty structural
Q. What will be the effects of an increase in the money supply on the interest rate? Answer: An enhance in the money supply will origins the interest rate to decrease. This m
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