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Consumer Equilibrium
To demonstrate the consumer's equilibrium i.e. the point at which the consumer maximizes utility with a given budget, we need to combine the indifference map and the budget line.
The consumer obtains maximum utility from a budget of AF by choosing the combination of X and Y represented by C, where the marginal rate of substitution is equal to the relative prices of X and Y.
General and Selective Credit Control These are imposed with the full apparatus of the law or informally using specific instructions to banks and other institutions. For insta
Financial engineering deals with the design of new assets. Draw the payoff (at t=1) of the following bull butterfly spread: Purchase 1 call with exercise price a Sell 2 ca
Demand for money The demand for money is a more difficult concept than the demand for goods and services. It refers to the desire to hold one's assets as money rather tha
PRODUCT DIFFERENTIATION Product differentiation describes a situation in which there is a single product being manufactured by several suppliers, and the product of each su
price output determination under monopoly explain
Occurrence of Stagflation Two possible theoretical explanations can be given for the occurrence of stagflation almost all over the world. The first explanation follows directly
Factors influencing Exchange Rates i. Inflation: Other things being equal, a country experiencing a high rate of inflation will experience a lower demand for its goods whil
needs for capital budgeting
Laws of returns to scale alludes to the long-run analysis of the laws of production. In the long run, output can be increased by varying all factors. So in this section we study th
Monetary Theory We have seen that Schumpeter theory which runs in terms of innovations and technical change, is at best an incomplete explanation of trade cycle . there are eco
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