Impact of taxation: Taxation on goods, income or wealth influencing economic behavior and the distribution of resources. For example higher taxes on carbon emissions will increase cost for producers, reduce demand and shift demand towards…
Meaning: Indirect tax is a type of tax that is imposed on goods and services than on income or profits. The key characteristic of an indirect tax is that it is collected by an intermediary…
Introduction: Taxes are compulsory payment to the government without expectation of definite return or benefits to the tax payer. According to Dalton, a tax is a compulsory contribution imposed by public authority irrespective of the…
Meaning: Production involves the use of various inputs or factors services to produce output. In economics production means transformation of inputs into outputs, in other words production is a process of changing the form of…
Introduction: Saving function is the counter part of consumption function because S=Y-C. Therefore S=f(Y). Saving means economic surplus, it may be defined as the difference between current income and current consumption. Keynes defined savings as…
Introduction: J.M Keynes created the theory of liquidity preference theory of interest to explain the role of the interest rate by supply and demand for money in 1936. According to Keynes the rate of interest…
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…
