GDP gap
"The economic cost of unemployment is measured by the GDP gap." Explain this statement. ?
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The GDP gap refers to the gap between current GDP and the GDP that corresponds to full employment level. The latter is also called the ‘potential GDP’. When there is unemployment the economy is unable to produce at potential level and the shortfall is the cost that the economy pays in economic terms. This is the cost in economic terms as it is the ’economy’s’ loss. There are other costs of unemployment, but they are personal and restricted to the unemployed person and his family.
Elucidate the basis of categorizing government receipts into revenue receipts and capital receipts. Answer: Revenue Receipts: The government revenue receipts are such receipts A) that neither makes liability
Explain the impact of changes in fiscal and monetary policies in curtailing inflation?
In the figure shown below, line T0 depicts a tax system which is: (1) Progressive. (2) Regressive. (3) Proportional. (4) Unbiased. (5) Recessive. Q : Problem on perfect replacements Imports Imports and American cars are much close however not perfect replacements. When the U.S. govt. tried to enhance American car sales by setting a price ceiling of P1 on imported cars: (i) The quantity of cars imported will drop/fall from Q0 to Q1. (ii)
Imports and American cars are much close however not perfect replacements. When the U.S. govt. tried to enhance American car sales by setting a price ceiling of P1 on imported cars: (i) The quantity of cars imported will drop/fall from Q0 to Q1. (ii)
‘Must a country which is less proficient at generating all goods use import controls to decrease imports from additional countries?’
What are the “powers of the Federal Reserve
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With the general equilibrium framework in place, the stage is now set for introducing fiscal and monetary changes and analysing their effects on the general equilibrium. We will first introduce a fiscal change in the form of increase in deficit-financed expenditure, a
According to law of diminishing marginal utility, the longer that Lee and Chris kiss: (i) the less invested each will be in ongoing this relationship. (ii) The nearer they are to reaching their joined production possibilities frontier. (iii) The more
Question: Compare and contrast 'adaptive expectations' (Hubbard uses adaptive expectations) and 'rational expectations' in modeling expectations. Answer:<
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