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Since World War II, North Korea has had a centrally planned economy in which the government makes the big decisions on how resources will be allocated. Why would you expect North Korea's production possibilities (per person) to be smaller than those of Australia? What are the economic institutions that help the Australian economy achieve allocative efficiency that North Korea might lack?
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Since 1990, real income has increased rapidly , yet the average number of children per family has decline ." Three possible explanations for this process are given below.
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