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Direct control and Moral Suasion Without actually using the above weapons, the central bank can attempt simply to use "moral suasion" to persuade the commercial banks to restr
State the Specific Time of demand Demand should be assigned specific time. For instance, it is an incomplete proclamation to state that demand of air conditioners is 4,000 at t
What are the conclusions about the cost of production and efficiency in the long-run equilibrium of a perfectly competitive industry? Three conclusions regarding the cost of pr
Suppose that the government is the only provider of water. The market demand function reads D: Q(P) = 50 - 2P. The government''s total cost for producing water are described as fol
all theory
Price elasticity of demand The price elasticity of demand is defined as the degree of sensitiveness or responsiveness of demand for a commodity to the changes in its price. Mo
Policy conflicts In their attempts to achieve the policy objectives, governments often face what are called conflict of objectives. These arise partly because unlike private
Goals of the firm How much is produced by a firm depends on its objectives. A firm which aims to maximise its sales revenue, for example, will generally supply a greater quant
Properties of Indifference Curves An indifference curve is usually convex to the origin. Indifference curves slope downwards from left to right. A set
1. The price of a CD (PC) is $10 and the price of a DVD (PD) is $20. Philip has his income (M) of $100 to spend on the two goods. Consider three consumption bundles: (C, D) = (2, 3
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