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Expectations played a major role in Keynes' theory of the determination of aggregat output and employment in market economies in the short run. Expectations about future yields on investment projects underlie 'the marginal efficiency of capital' schedule However, the volatile nature of these expectations plays a major role in explaining why investment expenditure and therefore output and employment in miarket econornies are subject to fluctuations.
Why elasticity is important for economic analysis? Elasticity is a significant concept in understanding the incidence of indirect taxation, marginal concepts as they relate to
Identify path of growth and development to economic maturity.
What should be the decent/appropriate growth rate in any country? Answer: A growth rate of among 2-3% is considered normal for mature developed countries; for LICs, 5-7% is
differential rents..
ed=1 means p
what is a sub game perfect Nash equilibrium
What two measures have been developed in recent years that subtract for the depreciation of both manufactured capital and natural capital? The environmentally adjusted Net Dome
Assume that the employer (principle) wants its employee (agent) to work hard [You can safely assume that this maximizes the principle's expected profits from his business]. There a
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For the purposes of economic analysis, a normal profit contains the cost of the lost opportunity of the next best option allocation of the firms resources. In a purely competitive
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