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SHORT-RUN EQUILIBRIUM All firms are assumed to aim at maximizing profits or minimizing losses. The monopolist controls his output or price, but not both. The monopoly maxi
Income Elasticity The functional relationship among the changes in the quantity demanded for a good or service and the change in income of those persons demanding the good or s
Explain cost output relationship with reference to: a. Total fixed cost and output b. Total variable cost and output
Borrowing Facilities If a country's currency is not convertible, it can borrow from countries whose currencies are convertible and use the convertible currencies to make its i
a) A change in demand means that: b) On the production-possibilities drawing, unemployment is represented by:
Explain the importance of managerial economics.
FACTORS RESPONSIBLE FOR WAGE DIFFERENTIALS BETWEEN OCCUPATIONS The major cause is demand and supply for the particular labour concerned, but other causes could be: i.
Problem 1: a) Explain what is meant by ‘price discrimination' and what are the different types of price discrimination. b) Under what conditions is it possible and profitabl
Factors determining Elasticity of demand Ease of substitution. Nature of the commodity i.e. whether it is a necessity of life, luxury or addictive. Consumers
scope of marginal costing
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