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Financial Economies:
These are benefits obtained by large firms as a result of contracting credit from financial institutions at lower interest rates than smaller firms. The fact is that the large firms can provide collateral securities for such loans and their mere sizes alone make them credit-worthy as compared to smaller firms. In addition to borrowing from financial institutions, large firms can easily float shares in the stock market. At times suppliers of materials to large firms may give them out on credit. This is a sort of pre-financing of the firm’s activity. All these advantages lead to the lower per unit cost of output produced.
Rational Expectations- Inflation Unemployment Trade-off : Now, consider what happens if we suppose that workers have rational expectations about the rate of inflation First, th
Consider the following duopoly with differentiated goods where x 1 and x 2 denote the amounts of the goods 1 and 2 respectively, with prices p 1 and p 2 . The demand funct
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Variability - The extent to which the possible outcomes of uncertain event may vary * Variability: A Scenario - Assume that you are choosing between two part time sales
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What are the economies and diseconomics of scale?
Socio Economic conditions of country also affect the sales forecasting. They may include total national income per capita income standard of living of the masses, education, inflat
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measures to control business cycle
Discuss MO theory in detail?
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