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Why is it so difficult for government to achieve all macro objectives simultaneously?
Specifically showing possible trade-offs i.e.
a) Stimulatory policies which enhance AD might cause inflation
b) Growth might conflict with full employment as structural and technological change affects demand for certain labour groups (see sectoral/technological/regional unemployment), supply-side policies might increase efficiency and create redundancies amongst labour groups
c) Full employment might also create inflation
d) Growth might increase imports (HL: MPM, and lower multiplicative effects) and decrease exports due to inflation
e) Growth Æ inflation Æ depreciation of currency
f) Fiscal stimulus may involve deficit spending and debt, which in turn could have a negative effect on the exchange rat
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Externalities: Many economic activities have collateral effects (at times positive, but more often negative) on other people who aren't directly involved in that activity. Illustra
Laspeyres index The Laspeyres index tells us that: - The amount of money at present year prices which an individual requires to purchase bundle of goods and services which w
Recent developments in demand theory
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two or more variable inputs
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which three group of the periodic table contain the most elements classified as metalloids (semimetals)?
Basics of Theory of demand: The most famous approach in the history of consumer behaviour, after indifference curve approach, is the revealed preference approach. In the revea
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