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Under specified assumptions, derive the square-root formula of the Baumol-Tobin's inventory model of transactions demand for money and briefly describe the effect of a one period increase in the price level on the demand for money. How would your answer change if real transaction costs decrease simultaneously with the one-period increase in the price level? Explain carefully and illustrate your answers with a diagram.
The monetarists have demonstrated that the early Keynesians were wrong in saying that money doesn't matter at all to economic activity. Therefore, we should accept the monetarist position that money is all that matters". Do you agree? Why? Why not?
Island Economy: Consider an economy as a sea with islands of local markets. Each household produces goods and sells them on one and only one of the arrays of these markets. Go
list all the type of cost
Problem: (a) Distinguish between fiscal and monetary policy, giving examples where appropriate. (b) Explain how fiscal and monetary policies might be used by a government
Q. Can you explain about Counterfactual? The ‘base case' or counterfactual is a statement of what could have happened without policy intervention, or if the policy intervention
SUMMARY OF THEORY OF PRODUCTION
what is theory of product pricing?
Explain about the perfect competition according to economics theory. The procedure of testing and refining theories is the key to the development of modern economics like a sci
How does the indifference curve and budget line for a neutral good look like?
Deficiency of Vitamin A Deficiency of Vitamin A has been found to impose adverse effects on roughly one third of the children below the age of five around the world. It has also be
What is pigovian welfare economics
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