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Q. Explain Reversed Say's Law?
In the cross model, supply should instead follow demand. Cross model not only rejects Say's Law, it turns it entirely upside down. In the cross model 'demand creates its own supply'.
Just as Say's Law is criticized by many economists, there is criticism of this reversed form of Say's Law. Firms passively produce exactly what consumers want. If there is an increase in demand, firms would just produce this extra quantity. Motivation for this behaviour by the firms is further analysed when we describe the labor market in the cross model.
discuss how opportunity cost principles influences a supplier''s decision to supply labor
The cash flows (CF t ) associated with an investment are listed below (assume that each cash flow occurs at the beginning of each year): CF 0 = -200
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Question : The long-run position of an economy is described by the quantity theory of money: M/P = L (Y, r) Where M: nominal money stock; P: price level; Y: real income a
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