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A risk-neutral agent's working life has two periods. In each period, the agent can provide high effort (at personal cost $2,000) or low effort (at zero personal cost). In a given p
NORMAL AND SUPERNORMAL PROFITS Normal profit refers to the payment necessary to keep an entrepreneur in a particular line of production. In economics, it is generally belie
Perfect Competition The model of perfect competition describes a market situation in which there are: i. Many buyers and sellers to the extent that the supply of
A medical insurance company offers its salespeople the following compensation scheme: each worker takes a fixed salary and, in addition to that, a commission depending on the volu
diagram of production function with one varaible
THE ACCELERATION PRINCIPLE Suppose that there is a given ratio between the level of output Y t at any time t , and the capital stock required to produce it K t and that
Managerial Economics helps create utility for the Society.
The neo-classical view The neo-classical view is that market forces are the best directors of the economy. Positive attempts by the government it is argued inevitably make th
Limits on the process of bank deposit creation On the demand side , there may be a lack of demand for loans, or at least of borrowers who are sufficiently credit worthy .
a bus operates two routes,one to harare and another one to johanesburg.the company analyst estimated that the elasticity of demand for joburg is 0.9 while for harare is 2.the compa
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