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Q. What do you mean by multiplier effect?
Loans and deposits in banks give rise to a significant multiplier effect. We use a simple instance to explain this effect. Consider the bank K-bank with total deposits of 10,000 (millions or whatever). K-bank is aiming for a reserve ratio of 10% of deposits. At the instance it has lent 9,000 and has 1,000 in reserve - exactly meeting their desired reserve ratio.
If you were a restaurant owner and you knew that the demand for your restaurant was elastic, how would you feel about a sales tax on restaurant food? Explain.
If population growth is greater than the growth of real output, A. real per capita Gross Domestic Product (GDP) growth will be less than the growth of real Gross Domestic Product
Sustainability of Current Account Deficit: Theoretically speaking, a current account deficit can be sustained as long as the growth rate of national income exceeds the rate of
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Using Simple Keynesian Model, discuss the effect of the following: a) An increase in govt. expenditure. b) A decrease in lump sum taxes. In this context compare the govt.
What is money has nothing to do with token We also consider that what is money has nothing to do with token or commodity itself: USD is money in United States but not in
Determine the rate of economic growth in UK With regard to economic growth, a good starting point for evaluation and analysis is the fact that rate of economic growth in UK has
After two quarters of increasing levels of production, the CEO of Canadian Fabrication & Design was upset to learn that, during this time of expansion, productivity of the newly hi
Once Y is determined, almost all of the other variables are determined since they are either exogenous or they depend on Y. From Y we can determine C by consumption function, I m
If there is an increase in the popularity of video games and more companies making video games, then the following is true? A) Sales of the games will be uncertain. B) Price will g
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