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Problem 1: All economies of the world can be said to be ‘mixed', to a greater or lesser degree, in that there is no economy where there is no state activity and no economy wher
How Income level must remain constant - law of demand The law of demand operates only when income level of the buyer remains constant. If income rises when the price of commod
Factors influencing the supply of a commodity a) Own Price of the commodity There is a direct relationship between quantity supplied and the price so that the hig
The Central Bank These are usually owned and operated by governments and their functions are: i. Government's banker : Government's need to hold their funds in an ac
Problem 1: (a) Distinguish between political and partisan monetary cycles on inflation and unemployment rates. (b) In the rule versus discretion literature, explain how dy
Relationship between AC, AVC, AFC and MC is elucidated graphically by drawing respective cost curves in Figure below. Behaviour of cost curves is elucidated below. Figure:
Describe ramsey pricing with detailed examples
What is the demand function It should be noted that by demand function, economists mean entire functional relationship which is the whole range of price-quantity relationship a
Fixed costs are those that are independent of output. They should be paid even if firm produces no output. They wouldn't change even if output changes. They remain fixed whether ou
BUSINESS CYCLES Meaning: The business cycle is the tendency for output and employment to fluctuate around their long-term trends. The figure below presents a stylised
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