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Under capitalism, most production is undertaken by private companies (of various forms), with the goal of generating a profit to the company's owners. Profit is obtained when compa
The marginal rate of substitution (MRS) quantifies the quantity of one good a consumer will sacrifice to get more of the other good. – It is calculated by the slope of the indif
1. Explain how the aggregate supply curve for the entire economy can be derived under; i. Classical assumption ii. Keynesian assumption 2. Explain how equilibrium can be a
Why is it so difficult for government to achieve all macro objectives simultaneously? Specifically showing possible trade-offs i.e. a) Stimulatory policies which enhance AD
(1) The demand curve for oranges is given by the equation P = 5 – Q/200. The supply curve is given by P = Q/800. Q is measured in oranges per day and price is measured in dollars p
Production Function Models
Efficiency of exchange
1
Problems Using Point Elasticity - We may need to compute price elasticity over portion of demand curve instead of at a single point. - The price and quantity used as base wi
optimal contracts under symmetric information
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