Describe GDP gap and Okun’s Law
Describe GDP gap and Okun’s Law?
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GDP gap is the difference between potential and actual GDP. Economist Okun quantified relationship between unemployment and GDP as follows: For every 1 percent of unemployment above the natural rate, a 2 percent GDP gap occurs. This has become known as “Okun’s law.”
Explain of the law of demand?
The price of KnickKnacks is $1 and the price of WigWags has increased with $2 to $3. Therefore: (w) absolute price of KnickKnacks has decreased and the relative price of WigWags has increased. (x) relative and absolute prices of KnickKnacks have
Elucidate the ways to finance corporate activity?
What happens to the demand curve when each of these determinants changes?
Entrepreneurs: (w) undertake risky forms of production to gain uncertain profits. (x) obtain interest payments for their services. (y) are usually overcompensated for their innovations. (z) receive virtually all their wealth by inheritance.
Patent rights: It is a unique license or right granted to a company or an Individual to make a specific product or utilize a specific technology.
Explain Government expenditures on goods and services and transfer payments?
What happens to the supply curve when each of these determinants changes?
When the prices for doughnuts and croissants are $.50 and $1 correspondingly: (w) the opportunity cost for one doughnut is two croissants. (x) this is better to buy two doughnuts than one croissant. (y) one croissant will make Pierre twice as happy as one doughnut. (z
Describe North American Free Trade Agreement (NAFTA)?
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