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One of the main tenets of economic analysis is that people act in their own narrow interests. Why, then, do people leave tips in restaurants? If a study were to compare the size of the tips earned by servers in roadside restaurants with those frequented mostly by locals, what would you expect to find? Why?
Explain the multiplier effect with example Deposits and loans in banks give rise to an important multiplier effect. We use a simple example to illustrate this effect. Consider
Explain the law of diminishing marginal returns using the example of a factory which is currently running at half capacity and employs more staff
using a classical labour market , illustrate the effects of a real wage existing in the market that is lower than the equilibrium real wage. what will eventually happen in this lab
An agency is having problems with personal phone calls made during working hours. Each minute of a personal call costs the agency $0.50 in wasted wages. The agency decides to hire
assume the cost of a market basket in 2008 is 1717.0. Calculate the cost of the same basket of goods and services in 2007. Price index in 2008 was 100 and price index in 2007 was
Explain the term- inventory investment We would have a negative inventory investment whenever inventories decrease. By net investments we mean gross investments minus depreciat
what are the opportunity cost?
Q. Describe about consumption function? The consumption function Consumption C(r) is assumed to be negatively related to the real interest rate r
Q. Describe Nominal and real interest rates? To distinguish real interest rate from the ‘normal' interest rate, latter is termed as the nominal interest rate. Nominal interest
distnguish betweenNational income at market price and National Income at factor cost, explain the importance of the distinction
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