Let us consider how it is possible to display and study the main elements of the mechanism for determining national income, based on the principle of effective demand, with the help of graphs. Somewhat simplifying, the principle of effective demand refers to the provision according to which, for sufficiently short periods of time at which […]
Tag: proposal
Theory of Comparative Advantage
From the theory of A. Smith it followed that the factors of production have absolute mobility within the country and move to those regions where they receive the greatest advantage. However, after some time, the advantage of some regions over others may disappear, therefore, trade will also stop. David Ricardo developed the theory of absolute […]