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Q. Describe the Keynes motivation? Keynes' motivation: In good times, when Y is high (above its trend), national income is high (above it trend). Consumers will take this opp
The circular flow of income in an open economy An open economy is one in which international trade exists. Assume also that there is government spending and taxation. Thus
What are the four managerial factors that lead to diseconomies of scale
Question 1: (a) Distinguish between the short run and long run profits of a competitive firm by using graphical representations. (b) Compare and contrast between perfect c
Give example of commercial banks how they create money For example, the borrower uses the money to buy an apartment, the funds are transferred to the seller of the apartment. T
Why a perfectly competitive retail market is more competitive than a monopoly
Q. What do you mean by Price index? Because we are only interested in percentage change of the price level and not particular value, we can divide every price level by a given
Classical Quantity Theories Quantity theories have had a long history and a widespread use in economics. As originally formulated these were not explicitly designed as theories
Steps to real wage rates to fall Wage 'stickiness' or wage inflexibility may stop the real wage rate falling to the full-employment wage rate. Stickiness or inflexibility is ca
State the Private sector in the circular flow Private sector total income is known as the national income. As private sector receives entire return from the factors of prod
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