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How does the four external factors influence Volkswagen?
“Assume the world economy has only two countries, Utopia and Nirvana, each of which
produces two products, milk and honey. Suppose that Utopia can produce 12 bottles of milk or
10 bottles of honey per hour, and Nirvana can produce 4 bottles of milk or 6 bottles of honey
per hour.”
Do you agree that Utopia has both the absolute and comparative advantages over milk and
honey? Justify your answer with appropriate analysis.
(I) is depicted by the long run philip curve
(Ii)is consistent with money neutrality
(Iii)shows effects of monentary policy in the short run
You have recently received a report from the Chief Finance Officer (CFO) indicating that the price elasticity of demand for the electronic equipment is 1. 6. Advise the CFO on what the figure 1.6 means and explain the relationship between price elasticity of demand and total revenue. (Use relevant diagrams to explain your answer)
