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Q. Using a figure, show that under full employment, a temporary fiscal expansion would increase output (over-employment) but cannot increase output in the long run.
Answer: A temporarily monetary expansion will move the economy from DD1 to DD2 and output increases. A permanent financial expansion will as well shift the AA curve to the left and down. The small exchange rate appreciates that is E decreases.
using diagrams, corden''s theory of customs union under conditions of oligopoly and within the existence of external economics of scale.
Postwar trade theory
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distinguish between net terms of trade and gross terms of trade
Q. There is frequently a conflict between short-term and long-term interests in trade. Discuss. Answer: In trade models that the short term is usually defined as that (conce
Illustration of reciprocal demand through example
Q. What is the theory of Second Best? Answer: The principal of the second best notify us that when an economy suffers from multiple distortions the removal of only a few
review the general equilibrium conditions under autarky and given free trade using the opportunity cost theory of trade
Using examples, from the government, illustrate the significant opportunity cost.
1.concepts of terms of trade,factors affecting terms of trade. 2.gross & net barter terms of trade. 3.terms of trade & economic development
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