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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
Income and Substitution Effects: Normal Good * The Special Case--The Giffen Good - The income effect may be large enough theoretically to cause the demand c
Equilibrium Exchange Rate: The theory of exchange rate determination explains how demand and supply of foreignexchange interact and jointly determine the equilibrium exchange
Suppose that there is a credit market imperfection because of limited commitment. As in the setup with collateralized wealth, each consumer has a component of wealth which has valu
The drawbacks of a mixed economy actually depend on how "mixed" it is. For instance, if it is mixed more towards a free-market, there is little regulation (some may see this as a g
The Snob Effect - If network is negative externality, a snob effect exists. * The snob effect refers to desire to own unique or exclusive goods. * The quantity demanded o
show that the necessary and sufficient conditions for consumer equilibrium under both cardinal and ordinal utility theories are identical .
Over the course of modern American economic history there have been market failures, various social problems, and other complexities that have resulted in certain resource markets
. Keep slope of supply constant and apply different slopes of demand curve and then show what happens if control price impose. Similarly, keep demand curve constant and apply diffe
Price elasticity is used in economics to determine the changes in price of goods and services. It measures the change in price demanded and quality supplied. Determinants of pri
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