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The only road connecting two populated islands is currently a freeway. During rush hour, there is congestion because of the heavy traffic. The marginal external cost from congestion rises as the amount of traffic on the road increases. At the current equilibrium, the marginal external cost from congestion is $5 per vehicle. Would a toll charge of $5 per vehicle lead to an economically efficient amount of traffic? If not, would you expect the economically efficient toll to be larger than, or less than $5?
income generation process through investment multiplier
Open Market Operations The Central Bank holds government securities. It can sell some of these, or buy more, on the open market, buying or selling through a stock exchange or
a. Explain why the demand for a particular brand is more elastic than the demand for all cigarettes. If Lucky Strike raised its price by 1% in 1918, was the price elast
Bank of Issue The central bank enjoys the monopoly of bank note issue i.e. no bank other than the central bank is authorised by law to print currency notes. Printing of paper
COSTS OF UNEMPLOMENT AND INFLATION In an economy both unemployment and inflation have adverse effects and policy makers formulate policy instruments to contain both
Q. Explain the Game theory? Game theory: Game theory is a branch of applied mathematics which is used in the social sciences, most particularly in economics, as well as in b
Q. Relation between average cost and marginal cost? Relationship between MC and AC are the following: If MC is below AC then AC should be falling. This is because, if MC
Rail Tours sells packaged tours on rail lines, including gourmet meals and a reserved bed. The most popular tours are in the autumn when colors are at their peak. The overnight pac
elasticity concepts occupies a central place in policy formulation explain in details
Equilibrium and Disequilibrium in the Balance of Payments If on the current account , the value of exports is equal to the value of imports, the balance of payments is said t
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