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Statics and Dynamics Economic models deal with stock and flow variables. These variables can be in one of the two states - equilibrium or disequilibrium - at a particular poin
Aggregate demand and Say's Law Y D = Y S in the classical model (Say's law) Aggregate demand Y D is defined as quantity of nationally produced
Describe the differences between the substitution effect of a wage increase and the income effect of a wage increase.
Define the individual consumer surplus and total producer surplus. Individual consumer: Individual consumer surplus is the net profit to an individual buyer through the purc
Interest rate determination The real interest rate r will be equal to the equilibrium real interest rate In the classical model we define equil
What is Consumer Price Index CPI is a price index of a specific basket known as the CPI-basket. CPI-basket contains essentially all the service and goods consumed in a country
Illustrate the overview and importance of macroeconomics? After familiar with this illustration, able to know: a. An overview of macroeconomics is the study about the econom
Suppose you have the following information about a closed economy: C = 50 + 0.80 (Y-T) I = 200 G = 100 a) Find out the equilibrium level of income. b) Suppose G in
What are cost and revenue relationships?
Recognize which of the following purchases is counted as a part of NI: a) Tata motors purchases tire from Good year to equip latest Indica. b) Tata motors purchases tires fr
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