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Bank Deposit Bank notes and coins together constitute the currency in circulation. But they form only a part of the total money supply. The larger part of the money supply i
Marginal Revenue (MR) This is the increase in Total Revenue resulting from the sale of an extra unit of output. Thus, if TR n-1 is Total Revenue from the sale of (n-1) units
Variable Reserve Requirement (Cash and Liquidity Ratios) The Central Bank controls the creation of credit by commercial banks by dictating cash and liquidity ratios. The ca
The economic cost Unemployment represents a terrible waste of resources and means that the economy is producing a lower rate of output than it could do if there were full empl
Ingrid and Jeff would like to use Saturday night together but have dissimilar tastes in entertainment. Jeff would like to go to the opera but Ingrid would prefer to see soccer. As
Equilibrium in a two commodity market Let us consider a two-commodity market model in which the two commodities are related to each other. Let us assume the functions for bot
What is an effective need of demand 1. An Effective Need: Effective need demands that there must be a need supported by the capacity and readiness to shell out. Henceforth there
Relevance of The Law of Diminishing Returns The law of diminishing returns is important in that it is seen to operate in practical situations where its conditions are fulfille
When is production profitable according to price-taking firm at profit, break-even or loss? Production profitable at profit, break-even or loss: a. When TR > TC, in that cas
Costs of Economic Growth (Increase in National Income) 1. People living in industrial towns suffer from the effects of a polluted atmosphere. 2. The manufacture of
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