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Rationale for government intervention There are six major functions the government can perform in an economy. 1. The government provides a legal and social framework within which
Determinants of investments: Expected Rate of Return: Investment spending is guided by the profit motive; thebusiness sector buys capital goods only when it expects such
what is reciprocal demand?
Suppose the demand curve for a consumer for coffee is: Q = 6 – 2P, where Q represents the number of cups per day and P is the price of coffee per cup. Question: Suppose the
RECENT DEVELOPMENT IN DEMAND ANALYSIS: For many years economic theorists analysed the optimal behaviour of consumers while econometricians estimated consumer demand and expend
Aggregate Demand When referred to in the circumstance of GNP or GDP, aggregate demand dealings the sum of what is spent by various parties in the United States for product and
Increase in Productivity and Real Wage Earnings: Labour has been charged that whereas it presses for higher wages through trade unions, it has failed to raise productivity. Sh
brief explain of keynesian consumption theory
#• The price of a laptop increases by 20% and there is a 40% drop in the quantity demanded. • The price of a pack of cigarettes increases by 10% and there is a 5% drop in the quan
"A firm in monopolistic competition maximizes its profit by producing where its price is equal to its marginal cost." Is this statement correct or incorrect? Explain.
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