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What are the basic analytical frameworks of modern economics?
The fundamental analytical framework of modern economics:
The fundamental analytical framework for an economic theory comprises five aspects or steps as follows:
a. Requirement of economic environments,
b. Imposition of behavioral assumptions,
c. Adoption of economic institutional arrangements,
d. Determination of equilibrium, and
e. Estimate of outcomes resulting through an undertaken institution.
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TC = 1q^3 - 40q^2 + 840q + 1800 Price= $750
what is the theory of second best? prove the theorem with the help of a diagram.
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