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Basic textbook models, such as the Mundell-Fleming model, say that capital inflow happens due to the domestic interest rate being higher than the world interest rate, and therefore
Buffer stocks and stabilization funds In this case the government buys up part of the supply when output is excessive, stores this surplus, and resells it to consumers in time
Explain trend projection method of demand forecasting with illustration.
Meaning of Fiscal Policy In this general theory, Keynes used fiscal policy when referring to the influence of taxation on saving and government investment spending financed thr
Features of Free Market System The features of a free market system are: (i) Ownership of Means of Production Individuals are free to own the means of producti
Suppose market demand and supply are given by Qd = 100 – 2P and QS = 5 + 3P. If a price floor of $20 is set, what will be the size of the resulting surplus?
1. Suppose in a perfectly competitive industry the market demand and supply forces combine to produce a short-run equilibrium price of Rs 70. Suppose that a firm in this industry h
Marginal Revenue (MR) This is the increase in Total Revenue resulting from the sale of an extra unit of output. Thus, if TR n-1 is Total Revenue from the sale of (n-1) units
Decrease in Demand At the initial equilibrium price P 1 , quantity demanded falls from q 1 to q d . But the quantity supplied is still q 1 at this price. Hence, this
Principles of Managerial Economics points
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