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Q. What are the main functions of money?
Answer: Money serves generally three important functions that are a unit of account, a medium of exchange and a store of value.
As medium of exchange money evade going back to a barter economy with the enormous search costs connected with it. Like a unit of account the use of money economizes on the number of prices an individual faces. Consider a financial system with N goods then one need only (N- 1) prices. Like a store of value the use of money in general ensures that you can transfer wealth between periods.
Q. Explain why one can write the demand for money as follows: Md = P L (R, Y) Answer: The collective money demand is proportional to the price level. Imagine that every prices
Investment analysis report on internationally competing firms Students will be organized randomly into small groups (typically 6), and will prepare an investment analysis of c
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Vernon's product cycle theory
Q. Explain why even owners of capital that cannot be moved can avoid more of the economic stability loss due to fixed exchange rates when Norway's economy is open to capital flows
Question 1 A local manufacturer of work gloves and gardening gloves has been enjoying moderate success in its local markets with a physical sales team. The president is convin
Q. "Bank failure may not be limited to banks that have mismanaged their assets." Explain why. Answer: A sound bank countenanced with the wholesale loss of deposits is likely to
Q. Why is it that North-South trade in manufactures look to be consistent with the results or expectations generated by the factor-proportions theory of international trade, where
Q. In Foreign and Home there are two factors of production, land and labor, used to produce only one good. The land supply in each country and the technology of production are ex
Q. Explain the effects of a permanent increase in the U.S. money supply in the short run and in the long run. Assume that the U.S. real national income is constant. A raise in
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