GDP
In calculating the GDP national income accountants:
Question: Suppose firm 1 and firm 2 merge. Call the new firm A. It has output xA and profit πA. Suppose there is Cournot competition after the merger. For now, we assume that the marginal cost of Firm A, the mer
Economic growth is generally defined as a sustained increase in per capital national output over a long period of time. It implies that for economic growth of a nation, the rate of increase in its total output must be greater than the rate of population growth. It ma
I have a problem in economics on Paradox of Value-total utility and marginal utility. Please help me in the following question. Water is more precious than diamonds when measured by _____, however less valuable when measured by _____. (i) Total cost, total benefit. (i
Consider a model economy with a production function Y = K0.2(EL)0.8, where K is capital stock, L is labor input, and Y is output. The savings rate (s), which is defined as
Explain the main features of Harrod - Domar Growth model. How does the Harrod Domar model explain the occurrence of trade cycles?
Question: Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest. How much control does the Fed have o
In what respect foreign trade will be helpful in eliminating the adverse economic influences of deficient demand? Answer: Export increases the demand for services a
Since the percentage of income paid in taxes generally declines as taxpayer income increases, standard sales taxes and “sin” taxes [for example, excise taxes upon liquor or tobacco] are illustrations of: (1) proportional t
Elucidate the concept of deflationary gap. Answer: Deflationary gap is the deficit in aggregate demand from the level needed to maintain full employment equilibrium
The consumer maximizes the utility whenever spending patterns causes: (i) Total outlays to increase each time prices are altered. (ii) Marginal utilities of each and every good consumed to be equivalent. (iii) Marginal utilities from the last cent spent on each and ev
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