Category: Economics

Network Externalities

Much of what basic microeconomics discusses is that a demand for a good is independent of somebody elses demand for that same good. For Example,  Adam’s demand for a new car depends on Adam’s tastes and income, the price of...

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Price Index

Price Index A Price Index is a measure of the average level of prices. So when we see a news on the TV that “Inflation is rising”, they are really reporting the movement of a Price Index. A price index is a weighted average of...

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Business Cycle

One important factor of business fluctuations is changes to aggregate Demand. Like I said before, any changes made to consumption, investment or government expenditure will change aggregate demand which as obvious will have...

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