national income
how to calculate national income under value added method
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
When this market starts in equilibrium at point e on S0D0 and then young American families rousingly “inherit” furniture as their baby-boomer parents shift into smaller retirement homes, then this market will tend to shift in the direction of: (i) point i.
Define Break Even point? Elucidate with the help of saving function. Answer: Breakeven point is a point where consumption equals to income and saving is equivalent t
Tariffs: -are also called import quotas. -may be imposed either to raise revenue (revenue tariffs) or to shield domestic producers from foreign competition (protective tariffs). -are per unit subsidies designed to promote exports. -are excise taxes on goods exported abroad.
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
Does a surplus of AD over AS always entail a condition of inflationary gap? Answer: No. Inflationary gap takes place only if AD > AS equivalent to full employmen
How Bank rates control the credit? Answer: Bank rate is the rate of interest at which the Central bank lends to Commercial banks. By increasing the bank rate centra
The origin of economic growth can be traced back to Adam Smith's Wealth of Nations. InSmith's view, economic growth of a nation depends on the 'division of labour' and specialization, and is limited by the limits of div
If the MPC is .70 and investment increases by $3 billion, the equilibrium GDP will:
The hypothetical information in the following table shows what the economic situation will be in 2015 if the Fed does not use monetary policy: Year Potential GDP Real GDP Price Level 2014 $15.2 trillion $15.2 trillion 110.0 2015 $15.6 trillion $15.8 trillion
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