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The managers of Firm A recommend that Firm A purchase Firm B because the purchase will diversify the business of Firm A. Diversification of risks is a desirable strategy for individual shareholders, but if shareholders can diversify their risk by holding stock in Firm B, is there any reason for Firm A to purchase Firm B? Suppose labor turnover is costly, could that provide an efficiency saving to support the proposed purchased? (Hint: If output is less variable, labor employment can be steadier.)
One problem in using exchange rate when comparing GDP per capital between countries is that is fluctuates a lot. A way of avoiding dependence on exchange rate is to use purchasing
Augmented Saving An alternative way of determining equilibrium GDP is to find the level of income where the sum of desired injections equals the sum of desired leakages. Desi
During the 1990s, technological advance reduced the cost of computer chips. Explain, with the use supply and demand diagrams, how the following markets are affected in terms of pri
given the market demand curve is P=a-bQ and MC=D. derive mathematicaly a perfect compettition, B monopoloy, C, Cournot Duopoly, D cournot Tipopoly, E cournot quadropoly, F Stackleb
The economy of Macroland has a balanced budget with fixed government expenditures G = 150 and T = 150. Investment is autonomous: I = 200. The consumption function is the foll
nature, development and function of money.
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
Explain the economy automatic stabiliser A budget deficit is shortfall between a government's tax revenue and its spending in a given year. If a government runs a budget defici
How have you responded to increases in the price of gasoline over the past few years? How would you respond if the price of gasoline doubled over the next two years? What alternati
Q. What do you meant by Investment? When we use the word investment, we characteristically mean 'gross investment'. Fundamentally, gross investment comprises all finished goods
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