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QUESTION
(a) Explain the real business cycle theory.
(b) Using appropriate diagrams differentiate between inflationary and deflationary gaps.
(c) Differentiate between the Life-cycle theory and the Permanent income theory of consumption and saving.
Question 1: (a) Explain, giving examples, the law of diminishing returns, clearly bringing out the relationship between cost curves and product curves in the short run. (
Suppose a $1,000 face value bond has a coupon rate of 8.5 percent, pays interest semi-yearly, and has an eight-year life. If investors are willing to take a 10.25 percent rate of r
demand and supply curve for luxury goods
QUESTION a) State and explain the assumptions of a perfectly competitive market. b) Analyse the effects on the firm's profit and output of an increase in demand in the short
Write a book review of a book of your choice (chosen from the list of course reference literature) by either Joseph A. Schumpeter or Israel Kirzner about entrepreneurship and macro
How does economic theory contributes to managerial decisions?
Does the work of the International Monetary Fund and World Bank overlap? Less developed countries turn to the: • International Monetary Fund to resolve debt repayment, exch
Flexible exchange rate system: A country is linked to other countries through two broad channels: trade flows andfinancial flows. Trade flows pertain to movement of goods and
QUESTION 1 Critically examine alternative theories of money demand and specify a demand for money equation for Mauritius. QUESTION 2 Discuss the macroeconomic and micro
Describe the characteristics of Monopolistic Competition
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