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Suppose three identical firms are engaged in Cournot competition in quantities. They all have marginal costs equal to 40. Market demand is given by: P(X) = 200 - X = 200 - (x
Determine the main target of monetary policy Since 1997 'official' main target of monetary policy has been to 'hit' inflation rate target set by government. Though since the o
derive the isoprofit functin
Define the term - Productivity Productivity is the concept which measures how outputs can be maximised from given inputs. In factories labour productivity is normally calculate
I am writing a research paper for my macroeconomics class and I am having trouble with it. I am writing on the topic of the monetary policy and i can''t seem to understand a few th
.measure to control inflation
A change in government purchases of goods and services results in a change in real GDP equal to $200 million. Assume the absence of taxes, international trade, and changes in the a
A significant argument for the augmentation has to do with concept of money illusion. Money illusion means that you care about nominal rather than real amounts. Imagine that your s
Q. How much money can banks create? Does that mean that banks can create an unlimited amount of money? No the answer is no - it would require them to lend an unlimited amount o
Interest rate determination The real interest rate r will be equal to the equilibrium real interest rate In the classical model we define equil
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