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Direct control and Moral Suasion
Without actually using the above weapons, the central bank can attempt simply to use "moral suasion" to persuade the commercial banks to restrict credit when they wish to limit monetary expansion. Its effectiveness depends on the co-operation of the commercial banks.
ChoppinAxe is a little Swedish firm that produces wood planks and operates in a perfectly competitive market. Each firm in the market has the following total cost function:
The economic cost Unemployment represents a terrible waste of resources and means that the economy is producing a lower rate of output than it could do if there were full empl
1. A sporting goods company has hired a management consulting firm to analyze demand in 20 regional markets for one of its major products: a treadmill. The consultant uses data to
Planned Economy Is a system where all major economic decisions are made by a government ministry or planning organisation. Here all questions about the allocation of resources
Merits of direct taxes a. They satisfy the principle of equity as they are easily matched to the tax payers capacity to pay once assessed. b. They satisfy the principles
a) The most well-organized combination of resources which can be used to make a given level of output is that which: b) The enactment of a guaranteed yearly income for al
a) In 1948, the money GNP was $520 billion and the price index was 120. In order to make the 1948 GNP comparable with the base year, the 1948 GNP must be adjusted to:
The variance of the OLS estimator is VAR( ^B)=σ 2 /ns 2 x , where s 2 x =£x 2 /x You're hired to estimate and you're going to be paid according to the accuracy of your esti
Ozark Bottled Water Products Inc
Lender of Last Resort The central bank also acts as the lender of last resort. Historically, this function developed out of the special position of the central banks. The centr
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