closed economy
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What must be added to NNPMP to obtain net national disposable income? Answer: The Net current transfers from abroad must be added to NNPMP to get national disposabl
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Devaluation means decrease in the external value of a country’s currency as an aware policy measure adopted by the Government of a country. In another words, we make our currency less costly in terms of foreign currency. This builds our goods ch
Question: What can we learn from the Japanese experience? Is the US headed for a 'lost decade? Answer: There was a similari
The Income effects will be most strongly positive for: (1) Normal goods. (2) Necessities. (3) Superior or luxury goods. (4) Substitutes and much negative for the complements. Find out the right answer from the above options.
A change in tax rate changes the IS equation, LM equation remaining the same. Let same, let us suppose that the government raises the tax rate from 20 percent to 25 percent<
Describe open market operations? What is its consequence on availability of credit? Answer: Open market operations signify the purchase and sale of government secur
Question: How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world, investment in both economi
Why are receipts from taxes classified as revenue receipts? Answer: Receipts from taxes are classified as revenue receipts since they do not build liabilities nor r
Distinguish between full-employment equilibrium and Under-employment equilibrium. Whenever equality among AD and AS is at full employment level it is termed as full employment equilibrium. Although whenever equali
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