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Discuss whether inflation or deflation is the more serious problem for an economy.
Inflation is a consistent general enhance in the price level, whereas deflation is a consistent fall in the general price level, i.e. negative inflation. The basic damage to an economy of both, ultimately showing - perhaps - that deflation, whereas rarer, can be held by many economists to be the greater of two evils.
Problem 1 (a) Explain the evolution of exchange rate system in Mauritius. (b) According to you, what factors determine exchange rates in the long run? Problem 2 "Inf
Demand for Risky Assets * Assets - Something which provides a flow of money or services to its owner. - The flow of money or services can be explicit or implicit . *
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Principle Agent Problem [Dealing with hidden action] Assume that the employer (principle) wants its employee (agent) to work hard [You can safely assume that this maximizes th
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