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Q. Explain Consumer Price Index? CPI is a price index of a particular basket known as the CPI-basket. CPI-basket comprise essentially all the servicesand goods consumed in a co
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Q. Money market with inflation and rising money supply? Figure: The money market with inflation and rising money supply If we let π M refer the growth rate in money
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Q. Production function and Growth? From the simple production function Y = f(L, K), we can classify three sources of growth: An increase in L. An increase in K.
ABSOLUTE ADVANTAGE
What is productivity? Productivity or average product (AP): It is output person which is output divided through number of workers AP= Q/L. There labour Productivity can
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Suppose a company is considering two investment projects. Both projects require an upfront expenditure of $30 million. The company estimates that the cost of capital is 10% and tha
Explain the Gains from Trade of market. Producer Surplus, Consumer Surplus, Gains through Trade and Efficiency of Markets: Consumers and producers both are better off since
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