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State in brief the Nominal wage level In macroeconomics, we are generally not interested in the wage for a specific individual though in the average wage for all employed indi
Illustrate an example of Consumer Price Index For instance, if we spend twice as much on apples as on pears, apples would have twice the weight in basket. The precise details o
DIFFICULTIES IN MEASURING THE NATIONAL INCOME There are some conceptual and statistical problems in measuring national product. Some items are excluded from the national incom
Use a diagram of the open economy model (e.g. fig 32.4 from the text) to illustrate and explain the effect of the following event on the market for loanable funds, the level of net
TRADE LIBERALISATION UNDER WTO: In the Uruguay Round negotiations, India agreed to reduce tariff on a large number of commodities and remove quantitative restrictions (QRs
Critically explain why interest rates are pro-cyclical, using the supply and demand for bonds framework.
1 (a) List two concerns with inflation. (b) Suppose that we are in a condition of fully flexible prices, but production of nails will not go above 200 chairs/month. What price w
The Budget Line: The Consumer Constraints The consumer would like to maximize his satisfaction by reaching the highest possible indifference curve. But in the process, he faces
Answer the following questions for a hypothetical economy whose situation in year 1 was as follows: M = $800 billion; long-term annual growth of real GDP = 3%; V = 4. The bankin
At first, it may seem obvious that consumption will rely on Y. If GDP is doubled in real terms over a number of years, government consumption, private consumption and investment wi
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