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What does the IS-LM framework mean?
The IS-LM model helps us to understand the two opposing theories. The IS (investment/saving) curve shows equilibrium in product markets. The LM (liquidity/money) curve shows equilibrium in the money market. The point at which the two curves intersect is the only combination of output and interest rates (i.e., bond yields) where both the goods and financial markets are in balance.
Imagine a country where plane and train services between two main cities are both provided by private companies, and, from a consumer perspective these services are viewed as subst
Profit maximization is theoretically the most sound but practically unattainable objective of business firms. In the light of this statement critically appraise the Baumol’s sales
Shifts in Supply and Demand When supply and demand vary at the same time, the impact on the equilibrium price and quantity is known by: 1. The shape of the supply and dema
demand for two market are P1=15-Q1&P2=25-Q2.the monopoly TC is C=5+3(Q1+Q2).What are ,output,profit&MR if the monopolist can price disc? riminate
Labor Total Output 1 30 2 50 3 60 4 75 5 80 a) If the price of the firm’s output is $12 per unit and the wage rate is $100 per worker, how many workers should the firm choose to
Explain crowding out and why it may be considered important for policy makers. Crowding out refers to how enhanced government borrowing (real borrowing!) might serve to raise i
Long run equilibrium - Perfect competition: In the long-run, on the other hand, the firm in perfect competition is making normal profit or zero economic profit as shown in Fig
using the indifference curve approach explain why the demand curve slope downwards from left to right...... is there any exceptions?
Problem 1: (a) Explain the meaning of inflation. (b) "Inflation is always and everywhere a monetary phenomenon." Discuss this statement. (c) Briefly explain the link betw
Consider the following: The city council has just approved the construction of a water park in your town. You are responsible for studying the impact of the new water park on the l
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