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Q. Interest rates and inflation?
Assume you have 1 million on 1st January 2008. A basket of services and goods similar to the CPI basket costs 100,000. You can then purchase exactly 10 such baskets on 1st January 2008.
Say that you can invest your million at a 10% interest rate. On 1st January 2009 you will then have 1.1 million. 1.1 million may not be enough for 11 baskets as prices may have changed. Let's say that inflation was 4% in 2008. Price of a basket has then increased to 100,000 * 1.04 = 104,000 and you can buy 1,100 / 104 = 10.58 baskets which is 5.8% more than last year. Yet your wealth has increased by 10% (in whatever currency you use), your real wealth (in baskets) has only increased by 5.8% and we say that real interest rate is 5.8%.
What is the development process? Development is measured through outcomes that are development occurs while key indicators of human well-being enhance. A reduction of poverty
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disuss with an aid of a diagram the kinked demand curve
Q. Show the Destruction of capital? Destruction of capital, for instance, through a war, works in the opposite way. Marginal product of labor falls, GDP per capita falls and po
Discuss the three major economic indicators and how they are indicative of our current economic climate.
Now we will analyse how macroeconomic variables fit together and present models which explain the main macroeconomic variables. Using these models we can, for instance, analyse
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if your earning records over year has been:Yt=$40000 Yt-1=$38000 Yt-2=34000 Yt-3=$32000 YT-4=31000,What is the your permanet income?
what are the limitation of economies scales
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