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Provide two examples of identity economics other than those given in the article
Bank Deposit Bank notes and coins together constitute the currency in circulation. But they form only a part of the total money supply. The larger part of the money supply i
Buffer stocks and stabilization funds In this case the government buys up part of the supply when output is excessive, stores this surplus, and resells it to consumers in time
The city of Cabernet is very popular for its production of wine. The inhabitants of the city have an aggregate demand for wine that can be described as follows: where Q d
Effects of Fluctuations in Exchange Rates When a country's currency depreciates, exporting firms may have competitive advantage but businesses which rely on imports for raw ma
Assumptions of Monopolistic Competition Monopolistic competition as the name implies, combines features from both perfect competition and monopoly. It has the following featu
No new substitutes for the commodity If some new substitutes for a commodity appear in the market, its demand normally declines. This is quite natural, since with the availabil
Theories associated with different market structures A firms profit maximising output decisions take into account the market structure under that they operate. There are 4 type
A firm's technology needsit to combine 5 person-hours of labor with 3 machine-hours to make 1 unit of output. The firm has 15 machines in place and the wage rate rises from $10 per
Mankiw Model of Nominal Rigidities There are two related reasons for which firms do not frequently change prices. First, as we saw in the discussion on menu costs, the cost
Factors influencing Exchange Rates i. Inflation: Other things being equal, a country experiencing a high rate of inflation will experience a lower demand for its goods whil
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