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The Neoclassical thinking that assumes that all firms are established with the intention of making profit has been challenged by the managerial discretion models. How successful ha
Read "How Did Economists Get It So Wrong" by Paul Krugman and second, the blog "History of Economics Playground", by Pedro Duarte, Tiago Mata, Clement Levallois, Yann Grd...etc., t
Interest rate determination The real interest rate r will be equal to the equilibrium real interest rate In the classical model we define equil
The government in the cross model Net taxes NT(Y) depends positively on real GDP in the cross model In this model when national income increase
Overnight target rates and inflation One of the main targets of every central bank is a low and stable inflation. It's main control variable is the overnight interest rate targ
Because of high production-changeover time and costs, a director of manufacturing must convince management that a proposed manufacturing method reduces costs before the new method
The amount of wealth that households and business desire to hold in the form of money balances is called the 'demand for money'. Individuals and firms have at their command only
The following Table B presents the 2010 population, employment, and unemployment data among working age persons for several countries. a. Calculate the number of people in the l
Different approaches to measure aggregate output
Fiscal Policy An Increase in Government Spending: Figure 1 Let us examine how an increase in government spending affects the interest rate and the level of income.
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