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The institutional intervention theories Collective bargaining provides an example of what is sometimes called bi- lateral monopoly; the trade union being the monopolist suppli
Q. Show the Fixed Proportion Production Function? A fixed proportion production function is one in that technology needs a fixed combination of inputs, say labour and capital,
Prices of other related goods i) Substitutes: If X and Y are substitutes, then if the price X increases, the quantity demanded of X falls. This will lead to inc
Borrowing Facilities If a country's currency is not convertible, it can borrow from countries whose currencies are convertible and use the convertible currencies to make its i
Real Rigidities in the Labour Market New Keynesian theories of the labour market help in explaining the existence of involuntary unemployment. The theories also attempt to
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 d
Costs of Economic Growth (Increase in National Income) 1. People living in industrial towns suffer from the effects of a polluted atmosphere. 2. The manufacture of
THE LAW OF DIMINISHING RETURNS (LAW OF VARIABLE PROPORTIONS) One of the most important and fundamental principles involved in economics called the law of diminishing return
(i) Do the laws of economics still work today? (use the case discussed in class to answer this question or any other examples) (ii) Provide examples of three factors that can sh
Drafting of Production Policy: Demand forecasts assists in drafting appropriate production policy so that there may not be any space between future demand and supply of a product.
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