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The structural deficit: A. falls as the economy expands and rises when it contracts. B. changes as actual income changes regardless of potential income. C. does not change when income changes, but changes only when potential income changes. D. rises as the economy expands and falls when it contracts.
Explain whether, the following statements are TRUE, FALSE or UNCERTAIN. Briefly justify your answer. (i) The circular flow shows how real resources and financial payments flow
All of the following fiscal policies will contribute to increasing budget deficits except: A. cuts in aid to farmers. B. tax cuts. C. increases in defense expenditures. D. increase
In the short run, the discrepancy between actual and expected price level causes changes in output and employment. But in the long run, if all other things remain constant, the hig
The different between williams managerial discretion model and baumol''s sales maximization model
Liberalisation of Capital Account and Convertibility Issue: Broadly speaking and irrespective of sector specificity, a liberalised system is one where the role of the governme
In order to observe the correlations between each variable, the most effective method to use is Vector Autoregression (VAR). VAR estimation uses a system of simultaneous equations
Question 1: Discuss the alternative theories of the demand for money and their relevance in specifying a demand for money function for a small island developing economy like
Instructions For the following 10 questions, consider an economy which is initially in equilibrium without a tax, with P* of $90 and Q* of 10. Later, a tax is put on the market
The circular flow of income in an open economy An open economy is one in which international trade exists. Assume also that there is government spending and taxation. Thus
What is gross domestic product Economic growth is most commonly calculated in terms of the annual percentage rate of change in real gross domestic product (GDP).
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