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Measuring Point Elasticity on a Non-linear Demand Curve Let's now explain the method of measuring point elasticity on a non-linear demand curve. Assume we want to measure the
THE GOVERNED ECONOMY The governed economy contains central authorities often simply called "the government" - who levy taxes on firms and households and which engages in numer
A mother is torn among choosing her son Leonardo and her daughter Meryl to have the last bar of chocolate in her cupboard. As both her children's needs the chocolate and she needs
Q. What is Internal Diseconomies of Scale? Internal economies of scale exist only up to a certain size of the plant. Size of plant is called the optimum plant size since with t
ChoppinAxe is a little Swedish firm that produces wood planks and operates in a perfectly competitive market. Each firm in the market has the following total cost function:
Arguments against protectionism Most of the arguments for protectionism may be met with counter arguments, but underlying the economic arguments as opposed to the social, mo
Price Elasticity at Terminal Points The price elasticity at terminal point N equals 0 means that at point N, e = 0. At terminal point M, although, price-elasticity is undefined
Equilibrium and Disequilibrium in the Balance of Payments If on the current account , the value of exports is equal to the value of imports, the balance of payments is said t
Function of Money Markets The money markets are the place where money is "wholesaled". As such the supply of money and interest rate which are of significance to the whole ec
Mankiw Model of Nominal Rigidities There are two related reasons for which firms do not frequently change prices. First, as we saw in the discussion on menu costs, the cost
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