Microeconomics
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Differentiate between APC and MPC. The value of which of them can be greater than another and when? Answer: APC is the average
Widely accepted normative macroeconomic policy objectives include: (w) full employment and economic development. (x) allocative, productive, and distributive efficiency. (y) maximum freedom and economic profits. (z) job security and equality within th
What are the limitations of using GDP as an index of welfare of a country?A) The N.I. figures provide no indication of the population, skill and resource of the country. Thus the levels of welfare stay low.B) A higher N.I. migh
Describe Okun's law? Give an illustration of how it works.
In a graph of competitive market in equilibrium, the net surpluses producers and consumers enjoy generally equivalents the area among the: (i) Demand and supply curve however to the left of point of the market equilibrium. (ii) Horizontal axis and a 45°line origin
Predictions which restricting international trade to protect specific industries and “infant” firms would (a) inefficiently decrease aggregate output and employment, (b) raise the market power of the protected firms and their workers, and
Law of supply: It is the claim which, other things equivalent, the quantity supplied of a good increases whenever the price of the good increases.
The fact that most of the necessities for life like water are priced much lower than the frivolities like diamonds is addressed by the: (1) Utilitarian enigma. (2) Law of diminishing marginal utility. (3) Rational ignorance of hypothesis. (4) Paradox of the value. (5)
Quetion: Explain why there are long-term Federal government budget problems. Explain why the base-line forecast of the CBO is misleading. Include in your answer why solutions to the problem
How prices allocate resources?
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