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DIFFERENTIALS AND DISEQUILIBRIUM
In a free enterprise system, workers aim at maximizing their wages. Hence, it would be expected that workers would move form low-paying industries to high-paying industries and the low-paying industries would raise wages so as to retain labour until wage rates were uniform for all workers.
In practice, however, we observe differentials in wages both between occupations and even within the same occupations. Differentials arising from the characteristics of the occupations are called compensating or equalizing differentials, because they represent pay units made to equalize the net remuneration and compensate the workers for differences in their jobs.
Buffer stocks and stabilization funds In this case the government buys up part of the supply when output is excessive, stores this surplus, and resells it to consumers in time
Ask questiHow does economic theory contribute to managerial decisions? on #Minimum 100 words accepted#
b) Discuss the validity in Zimbabwe of the grounds on which the profit maximising model of the firm has been defended.
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Discuss whether Indian Consumer goods industry is growing at the cost of future Profitability.
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