because firms have more attractive investment opportunities. Both the supply and demand curves (Bd and Bs) shift to the right‚ but as is indicated in the text‚ the demand curve probably shifts less than the supply curve so the equilibrium interest rate rises. Similarly‚ when the economy enters a recession‚ both the supply and demand curves shift to the left‚ but the demand curve shifts less than the supply curve so that the interest rate falls. The conclusion is that interest rates rise during booms
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cardinal approach 5.6 Consumer’s surplus 5.7 The ordinal utility approach to consumer behaviour: the indifference curve approach 5.8 Consumer’s budget constraint 5.9 Consumer’s equilibrium in the ordinal utility approach 5.10 Special cases 5.11 Price-consumption curve 5.12 Income-consumption curve 5.13 Price‚ substitution‚ and income effects 5.14 Derivation of the demand curve for a good 5.15 Inferior goods and Giffen goods 5.16 Let us sum up 5.17 Some key words 5.18 Some useful books
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be falling. C) can be less than zero. D) never equals average product. Ans: C Exhibit 3 4. (Exhibit 3: Short-Run Costs) Curve A is the _______ cost curve. A) average total B) average variable C) marginal D) total Ans: C Exhibit 4 5. (Exhibit 4: A Firm ’s Cost Curves) The curve labeled V represents the firm ’s _______ curve. A) total cost B) average total cost C) marginal cost D) average variable cost Exhibit 5 | | 6. | (Exhibit 5:
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Q.1. What are indifference curves? Explain the consumers’ equilibrium under the assumptions of ordinal approach. Utility of goods cannot be measured in terms of précised quantitative term. J. R. Hicks and R.G.D. Allen developed Indifference Curve analysis based on ordinal approach. Indifference curve (IC) is defined as the locus of point which show the different combination of two goods or commodities a consumer is indifferent about the point A or B or C or D. According to this analysis the consumer
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applying a translog variable cost function‚ the capacity utilization has been estimated with respect to two alternative measures of potential output: (i) where short-run average cost is minimum‚ and (ii) whe re short-run and long-run average cost curves are tangent. The results reveal that the capacity utilization in Indian Airlines has been poor in general and also declining over the last decade. Therefore‚ the study suggests a need to improve the capacity utilization‚ which in turn would improve
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No: C0153BGOBGO0414 Table of Contents INTRODUCTION 3 1. Estimation of Market Model for Lloyds 4 Regression Graph 4 Summary Output 5 Regression results interpretation 6 2. Yield Curve 7 (a)What is the yield curve? 7 Shape of the yield curve? 7 Factors that affect the slope of the yield curve 8 (b) Yield curve graph 10 3. Valuation of the shares for Lloyds Company 11 Valuation Methods 12 Earnings based method 12 Asset based method 12 Discounted Cash flow methods i.e. (free cash flow or Dividend
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people also are far less likely to spend money‚ reducing the overall wellbeing of the economy as well. A certain level of unemployment is normal and natural though. In the past economists used the “Phillips Curve” to show an inverse relationship between inflation and unemployment. This curve was based on Economist William Phillips’ findings; when unemployment was high‚ wages increased slowly; when unemployment was low‚ wages rose rapidly...the lower the unemployment rate‚ the tighter the labor market
Free Economics Unemployment Inflation
Morton & Handley Case Study a. What are the four most fundamental factors that affect the cost of money‚ or the general level of interest rates‚ in the economy? The four most fundamental factors that affect the cost of money are: production opportunities‚ time of consumption‚ risk and inflation. The interest rate given to savers is based on: the rate of return on invested capital‚ savers time preferences for current versus future consumption‚ the riskiness of the loan‚ the expected future
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operations‚ delivering around 30% more profit from each percentage point of market share than its two closet rivals. 2 Vulnerability and Costs Vulnerability may be determined by the steepness of the Short Run Average Total Cost (SRATC) curve. B&Q’s SRATC curve is driven by; Distribution Costs‚ Property Costs‚ Energy Costs‚ Staffing Costs (Quasi-fixed) and Debt Interest. B&Q owns a property portfolio valued at £800M‚ most of which is used for trading purposes. There has been no significant addition
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Examen de finanzas 4029 1. Financial markets a. transfer funds from those who have excess funds to those who need funds. a.i. surplus units a.i.1. Those participants who receive more money than they spend a.ii. deficit units a.ii.1. Those participants who spend more money than they receive 2. Securities a. are certificates that represent a claim on the issuer. a.i. Debt securities a.i.1. are certificates that represent debt ( borrowed funds) incurred by the issuer. a.ii. Equity securities
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