If households
If households become more willing to hold less cash and more stocks or bonds, the
The usual household maximizes the utility by spending all its money to purchase and consume a combination of goods which yields: (1) Fundamental physiological requirements and customary wants. (2) Maximum status and the social prestige. (3) Complete satisfaction of al
Why the repayment of loan is a capital expenditure? Answer: Repayment of loan is taken as a capital expenditure since it diminishes the liabilities of Government.
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Use economic theory to explain the inflation movements and factors influencing it. Use relevant models to explain the impact of changes in fiscal and monetary policies in curtailing inflation.
What is the impact on income or output and price of excess demand (Inflationary gap)? Answer: In the condition of excess demand (that is Inflationary gap) there wil
What are the “powers of the Federal Reserve
‘Over the precedent 30 years, and particularly as our entry into the EU, imports (and exports) as a proportion of GDP have increases considerably in the UK. What influence has this had on the value of multiplier in the UK?’
Does full employment take place if AD = AS or S = I?
Adam Smith disputed that a nation’s wealth is, not the gold it possesses, but instead its: (1) Total population. (2) Capability to offer goods for its people. (3) Domestic financial capital. (4) Foreign investments. (5) Military might.
To begin with, let us recall our three-sector product-market equilibrium model given as C + I + G = C + S + TTo this three-sector model, we now add the foreign trade-the exports (X) and imports
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