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In the short-run the firm can't modify or change overhead factors like equipment, plant and scale of its organisation. In the short-run output can be decreased or increased by chan
CLASSICAL VIEW ON UNEMPLOYMENT The classical economists as we observed in Unit 1 of this course, were of the view that full employment prevailed in the economy all the tim
Features of Monoploy in Monopolistic Competition Monopolistic competition has the following features from monopoly : As the products are differentiated substitutes, each b
Q. What is Production and Cost Function? Production functions and cost functions are the keystones of managerial and business economics. A production function is a mathematical
Factor combination in the long run In the long run it is possible to vary all factors of production. The firm is therefore restricted in its activities by the law of diminish
A company uses 2 inputs, K and L in its production function. The production function is given as where Q, K and L are in units per week. Price of input K per unit is RM100, and inp
Mark works for Maple Feel Inc., which exports maple syrup to Slovakia. Currently, he generates $60,000 a year of net revenues for the firm and his salary is $60,000 per year. Mark
For all regular goods, income elasticity is positive though the degree of elasticity fluctuates as per the nature of commodities. Consumer goods are generally categorised under thr
Consider an economy with three assets and three states. Let be the matrix of asset payoffs at t=1 and p the vector of asset prices at t=0. Assume p 3 =2. a) Does an ar
Causes of Inflation At present three main explanations are put forward: cost-push, demand-pull, and monetary. Cost-push inflation occurs when he increasing costs of prod
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