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Real Interest Rate: Interest rate on a loan, adjusted for rate of inflation. Real interest rate represents real burden of an interest payment. Real interest rates should be positive for lender to obtain any real income from the loan.
the basic circular flow model suggests that...
What does the IS-LM framework mean? The IS-LM model helps us to understand the two opposing theories. The IS (investment/saving) curve shows equilibrium in product markets. Th
The government notices that there is an output gap and decides to increase government spending with a stimulus package of $4 trillion in hopes that it will spur growth and stop une
The marginal benefit of a refrigerant in a production process (the producer's willingness to pay for its use) is 100-5Q. The marginal damage from the use of the refrigerant on the
Q. What is Heterodox Economics? Heterodox Economics:Different schools of thought (including post-Keynesian, Marxian, structuralist and institutionalist economics) which reject
Discount Rate The term discount rate relates to business valuations. It is the rate applied to a future torrent of making an income or cash flow to measure its represen
economists would predict that if salaries increased for engginieers and decreasded for mba braduates that fewer people would go to graduate school in business and more would go in
Average Total Cost (ATC): ATC is the total cost per unit of output. ATC = TC/y = (TFC + TVC)/y = AFC +AVC ATC falls sharply at the beginning of the production process because
The demand curve for gasoline is P = 200 - 10Q. a. Find the elasticity of demand for a quantity of 8. Does this number imply that quantity demanded is sensitive to price chan
What are the main causes of unemployment? Two main paths are available; demand-deficient unemployment and real wage unemployment. After explaining unemployment (percentage o
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