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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.
In theory, we know that a monopolist basis its price directly off of the demand curve, but in practice a monopolist cannot ''see'' the demand curve. Explain how a monopolist might
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the law diminishing marginal utility explain through flow chart
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why the PPC curve slopes downward?
The Hypothesis of Rational Expectations : In the General Theory (Keynes, 1936) we noted that the state of expectations was taken as given. There was, in addition, explici
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