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Thinking about modifications in the model again: Go back to the original model again, but add a marginal propensity to invest, this is, suppose that I = f ( i and Y). The MPI is defined as ΔI/ΔY and has a positive value. Will this increase, decrease or not affect the value of the government expenditures multiplier? Describe!
Measurement of Inflation The rate of inflation is measured using the Retail Price Index. A retail Price Index aims to measure the change in the average price of a basket of g
State about Managerial economics Managerial economics is a discipline which is designed to facilitate a solid foundation of economic understanding for business managers and al
PHILLIPS CURVE The Phillips curve, named after A. W. Phillips, describes the relationship between unemployment and inflation. In 1958 Phillips, then professor a
Fundamental of managerial economic
T HE BANKING SYSTEM Consists of all those institutions which determine the supply of money. The main element of the Banking System is the Commercial Bank (in Kenya). The sec
What is optimal output rule? Optimal output rule: According to the optimal output rule, describe that profit is maximized through producing the quantity of output at that th
Goals of the firm How much is produced by a firm depends on its objectives. A firm which aims to maximise its sales revenue, for example, will generally supply a greater quant
It can be geometrically proved that two elasticity are equal, which is., QB=RD Let's first consider ΔAOB. If we draw a horizontal line from point Q to intersect the vertical axis a
Explain important terms of marginal productivity and wage inequality Marginal Productivity and Wage Inequality: a. Market power • Compensating Differentials • Dang
Cross Elasticity Cross elasticity of demand measures the degree of responsiveness of the quantity demanded of one good (B) to changes in the price of another good (A). It is
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