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A firm with two factories, one in Michigan and one in Texas, has decided that it should produce a total of 500 units to maximize profit. The firm is currently producing 200 units in the Michigan factory and 300 units in the Texas factory. At this allocation between plants, the last unit of output produced in Michigan added $5 to total cost, while the last unit of output produced in Texas added $3 to total cost. Is the firm maximizing profit? If the firm produces 201 units in Michigan and 299 in Texas, what will be the increase (decrease in the firm's total cost?
What are the Responsibilities of central banks Responsibilities include providing banking services to commercial banks and the government and regulating financial markets and i
Q. Describe Endogenous growth theory? Endogenous growth theory or new growth theory was developed in the 1980s by Paul Romer and others. In neo-classical model, technological p
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Determine in detail about money supply of Central bank The central bank will not pay cash when it buys government securities. Instead, it will ask the seller's bank to credit t
How can we define the real wage as nominal wage We define real wage as nominal wage divided by a price index (typically CPI). In the illustration above, your real wage was 20 i
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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
Suppose that a grocery store buys milk for $2.10 and sells it for $2.60. If the milk gets old then the grocery store can sell their unsold milk back to their wholesaler for $0.60 (
Determine about the gross domestic product Growth By (nominal) GDP-growth we mean % change in (nominal) GDP over a particular period of time. Real GDP growth is stated as perce
Q. Aggregate supply in AS-AD model? In order to figure out all the variables in AS-AD model, we need one more equilibrium condition so that we can identify a unique point on AD
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