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Q. Consumption function in the AS-AD model? Consumption. Suppose that P increases by say 10% whereas real GDP (Y) is constant. Nominal GDP and nominal national will now have
Relationship between the interest rate and the bond price Note that the higher the issue price, the lower the interest rate. Similarly when the price of a government bond incr
Q. Define market for overnight loans? The market for overnight loans Overnight interest rates are rates for loans over a single night - these are the shortest of all inte
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Q. Investment demand of the AS-AD model? Investment demand. As long as we keep nominal interest rate (and thus real interest rates) constant, there is no reason for demand for
Say that the equilibrium price and quantity both rose. What would you say was the most likely cause? There was _____(increase, decrease, no change) in demand and ________(increase,
what reasons limit the bargaining power of trade union in developing countries
A friend says that the economy will produce inside the PPF curve (like pt E below) since we in the economy value saving, or for some other reason. You say this is incorrect. Why? U
Consumption = $3 trillion, Investment spending =$2 trillion, Government purchases = $2 trillion, net exports via the ROW is $0 trillion. 1. What is the best estimate of real GDP
REVEALED PREFERENCE APPROACH The downward slope of the demand curve was justified on the basis of utility derived by the consumer. But specification of consumer tastes in form
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