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Differentiate between real and nominal variables.
In economics, the distinction among nominal and real numbers is often made. Nominal variables -- like nominal wages, interest rates and gross domestic product (GDP) -- refer to amounts that are paid or earned in money terms. Real variables -- real wages, interest rates, and GDP -- are corrected for the effects of inflation. They show the value of these numbers in terms of the purchasing power of wages, interest, or total production.
Labour Extraction: Most employees under capitalism are paid according to time they spend at work. Though employers then face a challenge to extract genuine labour effort from their
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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.
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#. The following information applies to the market for a particular items in the absence of a unit excise tax: Price($ per unit) Quantity Supplied Quantity Demanded 4 50
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