State excess demand or inflationary gap
State excess demand or inflationary gap: Excess demand takes place whenever AD is bigger than AS at the level of full employment equilibrium.
Legal tender money: Money which is declared legally as the medium of exchange by government is termed as legal tender money.
In which market form, the firm is a price taker? Answer: In Perfect competition
Define macroeconomics?
Why the coefficient of price elasticity of demand is is negative?
Consumers’ demand prices and sellers’ supply prices may be different in equilibrium due to: (w) arbitrage. (x) expectations about availability. (y) the invisible hand. (z) government subsidies or tax wedges.
The economy consists of a single buyer and a single seller. The buyer has the utility function b ln xB1 + xB2 with b ≤ 10. The seller has the
To form and effectively keep a cartel over time needs that the: (w) bulk of output be produced and sold by a minute number of cartel members. (x) product be relatively heterogeneous. (y) demand for the product be highly elastic. (z) government totall
Profit for purely competitive firms tends in the direction of zero in the long run since: (w) managers resist charging more than a fair price. (x) firms collude to charge prices which barely cover average costs. (y) profit attracts entry, whereas loss
When a purely competitive industry is into long run equilibrium, in that case for the typical firm: (a) P = FC = TC = MC = MR = AR = AC. (b) P = AR = MR = SRMC = SRAC = LRMC = LRAC. (c) pure economic profits reward especially effectiv
Vigorous competition into a market depends in the long run most strongly upon the: (w) number of buyers and sellers presently in the market. (x) freedom to enter and exit the market. (y) sizes of the average firm within the market. (z) uniformity [hom
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