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Importance of macroeconomics models
Using the models we can, for example, analyze what happens when the government increases consumption, when the central bank increases the target interest rate and when domestically produced goods do well in foreign markets. We can also understand important observations of the economy, such as cyclical fluctuations in growth, correlation between unemployment and inflation and the relationship between interest rates and foreign exchange rates.
Effective Demand The concept of effective demand is the logical starting point of Keynes Theory of Employment. Effective demand manifests itself in the aggregate expenditure of
Q. Describe classical model of macroeconomics? Though we use the term ‘the classical model' as if there were just one classical model, this isn't quite true. For all the models
Climate and terrain in several South American countries are conducive to growing coffee efficiently. While other countries can grow coffee, they are not as efficient and effective
TRADE IN SERVICES: India had objected to the inclusion of trade in services in the agreement for the UR negotiations. The Indian negotiations continued to raise object
Relate overnight rate with money supply When the overnight interest rate decreases, the money supply increases When the overnight interest rate increases, the money supply d
Consider the following Marginal Private Cost (MPC), Marginal Social Cost (MSC) and market demand curves. These curves relate to a market for a product, the production of which gene
A farmer grows a bushel of wheat & sells it to a miller for Rs. 1.00. The miller turns the wheat into flour & then sells the flour to a baker for RS. 3.00. The baker uses the f
If a supply curve goes through the point P = $10 and Qs = 320, then a. $10 is the highest price that will induce firms to supply 320 units b. $10 is the lowest price that wil
briefly explain with keynesian consumption?
Q. Monetary base and the supply of money? It isn't possible for central bank to print and distribute money -which would increase their debt without increasing their assets. Rat
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