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ELEMENTARY THEORY OF PRICE FORMATION: DEMAND-SUPPLY ANALYSIS: We discuss the elementary theory of price formation. Demand curve in the market is derived from the aggregate con
Gains from International Trade: It leads to increased total world production of goods and services. International trade based on comparative cost advantage allows countries to
Advantages of Division of labour: Division of labour has advantages including the following: Development of Greater Skill by the Worker In division of labour, each
Token Privatisation: This implies the sale of 5 per cent or 10 per cent shares of a profit-making public sector enterprise in the market with the objective of obtaining revenue t
what is the theory of Second best? Prove the theorem with the help of a diagram.
What are the basic questions to be answered by economic institution? Four fundamental questions should be answered by any economic institution as: a. What goods and services
Slutsky Theorem - Mathematical Presentation: We already know from the first order conditions of utility Maximisation that, where D ij is the co-factor of the ith ro
How might a “perfect” macro equilibrium be affected by (a) a stock market crash; (b) the death of a president; (c) a recession in Canada; (d) a spike in oil prices?
Returns from Education Monetary benefits from education are called as returns. Such benefits accruing to an individual are called as private returns. The sum of all private re
Explain how a floating exchange rate works and the variables which affect the rate. Define a floating exchange rate as the price of a currency (in terms of another or basket of
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