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Average Propensity to Consume The average Propensity to Consume [APC] is defined as the fraction of aggregate national income which is devoted to consumption. If consumptio
Asuume there are two inputs in the production function, labor & capital, and these two inputs are perfect substitutes. The existing technology permits one machine to do the work of
In the city of Gelato the market for ice cream is perfectly competitive. Aggregate demand for ice cream is: where p is the price for one cone of ice cream. All ice cream pr
Keynes Theory Keynes views about trade cycle entitled notes on the trade cycle of his classic the general theory of employment interest and money published in 1936. Although K
Movements along the supply curve Movements along the supply curve are brought about by changes in the price of the commodity. When price increases from P1 to P2, quant
Explain about the equilibrium in the labor market. Equilibrium into the Labor Market: All of firm will hire labor up to the point at that the value of the marginal product o
LONG RUN OUTPUT In the LR whether or not the firm makes profit will depend on the conditions of entry. For example, when surplus profits exist, there will be new entrants bec
examine the endogenous and exogenous determinants of money supply
The demand curve Suppose that starting from a condition of equilibrium, the price of X falls relative to Y. We now have a condition where the utility from the last shilling s
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