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Demerits of direct taxes a. Heavy direct taxation, especially when closely linked to current earnings, can act as a serious check to productivity by encouraging absenteeism
In the long run, because of the assumption of free entry and exit of the firms, it's not possible for the firms to make super-normal profits nor it is possible for them to incur lo
Why do the managers in marris model maximise their satisfaction by choosing a higher growth rate and a lower valuation ratio when compared to the profit maximisation
Arguments against Monopoly However monopolies have been accused of the following weaknesses. Diseconomies of scale While the monopolistic firm ca
Factors influencing demand for a product These are broadly divided into factors determining household demand and factors affecting market demand . Factors affecting hou
T HE BANKING SYSTEM Consists of all those institutions which determine the supply of money. The main element of the Banking System is the Commercial Bank (in Kenya). The sec
Liquidity and the multiple contraction of deposits Many of the instruments of monetary policy depend upon limiting liquidity, which has a multiple effect upon bank' deposits t
Another vital relationship that is often referred to in economic analysis is the relationship between consumption expenditure andprice elasticity. From the law of demand, we know t
Factors affecting the total market demand These are broadly divided into the determinants of demand and conditions of demand. (a) Own price of the product This
Shifts in the supply curve Shifts in the supply curve are brought about by changes in factors other than the price of the commodity. A shift in supply is indicated by an entir
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