Introduction: The Keynesian concept of consumption function stems from the fundamental psychological law of consumption which states that there is a common tendency for people to spend more on consumption when income increases but not…
Introduction: The classical economist believed in the existence of full employment in the economy. To them full employment was a normal situation and any deviation from this regard as something abnormal. According to Pigou the…
Introduction: The estimation of national income refers to the process of calculating the total economic output of a country over a specific period, usually a year. National income is a key indicator of a country’s…
INTRODUCTION: The estimation of national income refers to the process of calculating the total economic output of a country over a specific period, usually a year. National income is a key indicator of a country’s…
Meaning: Macro economics is that branch of economics which deals with the study of aggregate or average behavior of the entire economy. In it we study the collective functioning of the entire economy. It deals…
Introduction: The subsistence theory of wages originated by the French economist in the 18th century and was developed by Adam Smith. It received the support of British classical economics like Ricardo and Malthus. The German…
Risk bearing theory of profit: This Theory of risk bearing was put forwarded by American economist professor Bernard Hawley in 1907 according to him profit is the reward for risk bearing. The theory explains like…
Introduction: According to classical economist the rate of interest is the price paid for the use of capital. Loanable funds theory is an improved from classical theory. According to this theory rate of interest depends…
The concept of quasi rent was first introduced by Marshall. He explained that besides land, other factors also get rent the only difference is that rent may accrue to land in the long run also…
Introduction: The Marginal Productivity Theory of Wages is an economic theory that explains how wages are determined in a competitive labor market. The theory is based on the idea that employers will hire workers up…