international trade
the most frequently asked question on foreign direct invetment
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Equilibrium quantity: It is the quantity supplied and the quantity demanded at equilibrium price.
In poor countries people spend a big percentage of their income so that APC and MPC are high. Yet, the value of multiplier is low. Explain why?
Individuals maximize the satisfaction whenever the marginal utilities of all goods are: (i) Precisely proportional to the consumer’s income. (ii) Maximized. (iii) Precisely proportional to the opportunity costs of consuming them. (iv) Equivalent
What are the components of aggregate demand (AD)? Answer: The components of AD are as follows:AD = C + I + G + (X - M) By Simplifying AD = C + I, Here C refers to Household consumption demand and I refer
Multiplier: The Multiplier is the ratio of change in income by the change in investment. Multiplier (k) = ΔY/ΔI
What are the strength and weakness of using per capital national income? give explained answer for query
Explain the concept of “economies of scale” and “increasing returns”.
Assume that you consume bananas and apples, and the marginal utility of the last apple consumed is 6 times the marginal utility of last banana consumed. Though, the price of apples is only 3 times the price of bananas. This disequilibrium among the two goods can be re
Why the value of MPC is not greater than 1? Answer: This is because change in consumption can never be more than change in income.
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