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Types of budget: Surplus Budget: A surplus budget occurs when the expected government revenue is planned to exceed the proposed government expenditure. It can be achieved by
Suppose that there is a credit market imperfection because of limited commitment. As in the setup with collateralized wealth, each consumer has a component of wealth which has valu
In an industry with two firms, represent the outputs for these single product firms as q 1 and q 2 . The two firms decide to form a cartel and set their levels of output to maxim
the meaning of supply
Substitution Effect - The substitution effect is change in an item's consumption associated with the change in the price of the item, level of utility held constant. - Wh
When you drop by the only coffee shop in your neighbourhood, you notice that the price of a cup of coffee has enhanced considerably since last week. You decide it's not a big dea
how measure the inflation
What is Expenditure Function? The Expenditure Function: When preferences satisfy the local nonsatiation assumption, in that case v(p, m) will be strictly increasing into m.
1. What is a resource market? 2. Describe resource demand and resource supply. 3. Define derived demand. 4. Describe the resource market demand and supply curve. 5. Define a te
What is opportunity cost? Answer: Opportunity cost is a term used in economics, to mean the cost of something in terms of an opportunity foregone (and the advantages that co
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