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Inflation-Unemployment Trade-off under Rational Expectations : Robert Lucas (1972) pointed out another implication of the above hypothesis of adaptive expectations. Suppose in
What are the differences between the IS-LM model and the Keynesian model? The 'simple' Keynesian model is a simplified model to exemplify Keynes's idea about the equilibrium i
Ask question using health care as an example explain how markets fail due to different types of externalities arising from jointness in production and consumption
Q. Explain General Equilibrium? General Equilibrium: Neoclassical economics presumes that production, employment, investment and income distribution are all determined by a con
Q. Explain the Post-Keynesian Economics? Post-Keynesian Economics: A modern heterodox school of economic thought that emphasizes more radical or non-neoclassical aspects of Joh
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What does the basic neoclassical, or traditional, model of economics assume about markets? It supposes that markets are perfectly competitive and smoothly functioning, and thos
Assume that John has the following preference relation over two goods, bread and bear (x1, x2). He strictly prefers any bundle x over y whenever x haves more bear than y, whatever
Aggregate Supply When referred to in the circumstance of GNP or GDP, aggregate supply refers to the labor and capital needs to proceeds the level of products and services need
What is the theory of Second Best? Prove the theorem with the help of a diagram.
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