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Problem 1:
a. Briefly explain and distinguish between a centrally planned, laissez-faire and mixed economy.
b. According to you, which type of economic system is most desirable? Why?
Problem 2:
a. Describe, with the aid of a diagram, what is meant by the circular flow of income.
b. Explain the problems involved in using national income data to compare standards of living in different countries.
The government notices that there is an output gap and decides to increase government spending with a stimulus package of $4 trillion in hopes that it will spur growth and stop une
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The circular flow diagram is used to represent the interdependence that exists between sectors of the economy. The diagram illustrates that there are various collections of same e
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How solve central problem of economy in mixed economic system?
Joe Brown’s dairy operates in a perfectly competitive marketplace. Joe’s machinery costs $500 per day and is the only fixed input. His variable costs are comprised of the wages pai
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