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Differentiate between Actual and Potential output.
Actual output is that level which economy in fact produces. In contrast, potential output is the aggregate capacity output of a nation; the maximum amount of goods and services that can be produced with available resources and a given state of technology.
Despite the economic progress that the U.S. has observed in the past century, the standard of living remains extremely low in many countries. Why are some countries relatively weal
Q. Evaluate Nominal wages? Nominal wages W = (W/P).P The nominal wage is equal to the real wage times the price level. Because the real wag
The LM curve with inflation We know that LM curve will shift upwards when P increases (presuming MS is constant). This is still true though we can also add that LM curve glid
Consider two perfectly negatively correlated risky securities A and B. A has an expected rate of return of 12% and a standard deviation of 17%. B has an expected rate of return of
For an interest rate of 12% per year compounded continuously, find (a) the nominal rate per year, (b) the nominal rate per quarter, (c) the effective rate per quarter, and (d) the
explain and illustrate how the Lm curve is derived.
The consumption function of an economy is given by c = 200+0.75(y-t) And the investment function by I = 200 = - 25r. Government purchases G and taxes Τ are both 100. T
Malthus surmised that "poverty and misery are the natural punishment for the failure by the ‘lower classes' to restrain their reproduction." The policy implication of this viewpoin
Compared with the situation before 1981, the marginal tax rates imposed on individuals and families with high incomes are now lower. What was the top marginal personal income tax r
A clinic uses doctors and nurses optimally and is servicing the maximum number of patients given a limited annual payroll. The last doctor hired treated 1,600 extra patients in a y
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