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Adding the economic activities of government to the circular flow model shows that: 1. Government spending creates inflation 2. Government purchases of goods and services,
WHAT IA GMP
Curvature of the Iso-quant: An iso-qunat is convex to the origin. This is so because as more and more units labour are employed, the producer would prefer to give up less and
Define the returns to scale in production technology. Returns to scale in production technology: Assume that we are using some vector of inputs x to generate some output y a
If the price of that cup of teh-tarik has increased in such an amount,economists may not necessarily conclude that the country is going throungh inflation.why is that so?
What is Laffer curve The Laffer curve is named after Professor Art Laffer who suggested that as taxes enhanced from fairly low levels, tax revenue received by the government wo
Individual Demand Substitutes and Complements 1) The two goods are considered substitutes if an increase (decrease) in price of one lead to an increase (decrease) in quant
Why is it considered well to bring all BOP's to zero? If BOP of any country is zero, it reflects that the present account of that country has sufficient balance to meet the n
Money: Broadly speaking, money is anything which can be used as a means of payment (for instance, to settle a debt). It includes bank deposits, actual currency, credit cards and li
why does the quantity of salt tend to be unresponsive to changes in its price
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