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Q. State the Marginal Productivity Theory. What are its features and assumption? Marginal Productivity Theory of distribution states that in a capitalist economy the demand for
Q. Illustrate diffrent types of interest rates? There are many other interest rates in a society. For instance, you will earn interest when you deposit money in a bank account
Differences between absolute advantage and comparative advantage? Ans) Absolute benefit and comparative benefit are two basic concepts to international trade. Under
Private sector in the circular flow The private sector total income is known as the national income. Because private sector receives the entire return from the factors of pr
Income and Substitution Effects of a Price Change Indifference curve analysis can be used to separate the income effect (IE) from substitution effect (SE). This is shown in Fig
Fiscal Policy An Increase in Government Spending: Figure 1 Let us examine how an increase in government spending affects the interest rate and the level of income.
c=100+0.8yd
What is Frictional unemployment Individuals who are temporarily unemployed when transiting between jobs or just entering labour market. This kind is typically short in durat
Describe the differences between the substitution effect of a wage increase and the income effect of a wage increase.
y explain whether you agree or disagree with the following statements. “If nominal GDP is less than real GDP, then the price level must have fallen during the year.”
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