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Reducing the budget deficit by cutting government spending could conceivably: A. increase income if interest rates rise enough and government spending is more productive than private investment. B. decrease income if interest rates rise enough and private investment is more productive than government investment. C. increase income if interest rates fall enough and private investment is more productive than government spending. D. decrease income if interest rates fall too much and private investment is more productive than government investment.
What is the total cost of producing output? The total cost of producing a specified quantity of output is the total of the fixed cost along with the variable cost of producing
suppose that a persons wealth is kshs. 50,000 and her yearly income is kshs. 60,000. suppose further that her money demand function is given by Md = y(0.35-i) where i= interest
REVEALED PREFERENCE APPROACH The downward slope of the demand curve was justified on the basis of utility derived by the consumer. But specification of consumer tastes in form
What is the difference between an economic luxury and an economic necessity? Ans) An economic luxury is wasting land on pools huge garden, etc. An economic requirement is what y
Q. Explain about Price Inflation? The major reason for allowing for non-constant wages in the model is that we then can allow for persistent deflation/inflation. With constant
Explain the Economic functions of money - A unit of account In a monetary economy, all prices may be expressed in monetary units which everyone may relate to. Without money,
When single business or corporation dominates its area and squeezes out all its competition, the result is the consumer does not have a open choice, and inevitably, the price of it
COMPONENTS OF TRADE POLICY: External sector reforms beginning with 1991 included dismantling of trade restrictions along with tariff rationalization, a move towards current a
Consider a nation in which the volume of goods and services is growing by 5 percent per year. If a country's economic size is growing faster than the rest of the world, then
THE FOUR BIG MACROECONOMIC ISSUES AND THEIR INTER-RELATIONSHIPS 1. Link between growth/development and the various factors of production of the commodities: Before we mov
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