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countries are indulged in trade because there are mutual gains from trade. but then what are these gains which they obtain and how are these
international trade can be understood as followsby the international trade we signify the exchange of goods and services between different countries.
the money multiplier is explained belowif you see carefully the money multiplier is nothing but an inverse of a reserve ratio. therefore we can write
the money creation process is explained belowwe can now study the money supply or the creation process. suppose the government wishes to buy pencils
they take deposits which mean borrow money and make loans which means lend money. the interest rate they pay on the deposits is less than the
the concept of moneymoney or paper currency serves three functions in any case it is the medium of exchange a store of value and the unit of account.
determinants of the income elasticity of the demandthe determinants of income elasticity of demand are given below the degree of necessity of the
the effects of advertising on the demand curveadvertising targets tobull change the slope of the demand curve which means make it more inelastic.
determinants of the price elasticity of demand are explained below1. number of close substitutes present within the market - the more and closer
elastic and inelastic demand can be understood as followsslope and elasticity of demand have an inverse relationship between them. when slope is high
arc elasticity is defined belowarc elasticity measurescalculates the average elasticity between two points on the demand curve. the formula is simply
point elasticitypoint elasticity is brought in use when the change in price is quite small which means. the two points between which elasticity is
cross-price elasticity of demand is explained belowcross price elasticity of the demand is the percentage change in the quantity demanded of a
income elasticity of demand is described belowincome elasticity of demand is the percentage change in the quantity demandedrequired with respect to
price elasticity of demand is explained belowprice elasticity of demandrequire is the percentage change in the quantity demanded with respect to
elasticity is a term broadly used in economics to signify the ldquoresponsiveness of one variable to changes in to another.rdquotypes of elasticity
government and price-determination can be understood as followsthe government might intervene in the market and mandate the maximum price price
equilibrium is explained as followsequilibrium is the state in which there are no shortages and surpluses or we can say that the quantity demanded is
factors shifting demand curve factors changingdemandeffect ondemanddirection of shift in demand curveeffect on equilibrium priceeffect
demanddemand is quantity of a good buyer who wishes to purchase at each conceivable price.the law of demand explains us that if the price of certain
goods market and factors marketgoods market is the market where goods are bought and sold for the
shortage surplus and price mechanisma shortage is the situation in which the demand exceeds supply which means producers are unable to meet the
in the view of above complications there is a long-standing debate on whether the fiscal policy should be active or passive in nature. note that in
financing of fiscal deficitsince the size of balanced budget of the multiplier is small it is not for all time possible to get the needed demand
the tax-adjusted multiplier and the balanced budget multiplier are explained belowtaxes act as drag on the multiplier effect of government