INTRODUCTION of The microfinancing industry of Sri Lanka.           Microfinance has been considered an effective tool for governments of developing countries to get positive results for poverty alleviation. International organizations and donors are working together to promote microfinancing instruments and bring innovation in a respective field. Under the term of microfinance, …

When the price structure of the product fails to meet the requirements after the consumption of the goods, there must be situation of market failure. This situation could happen due to deficiency in the utilization of resources in production. There must be some factors which could cause market failure such …

For any country, the airline industry plays an extremely important in the economy. The contribution of this industry is able to change the economic structure of any company. In that report, there is complete information about the airline industry microeconomics and their main issues. This report is discussing the industry …

        According to the identity of national income saving is a difference between output, consumption, and government expenditures. Hence the increase in output will increase the savings assuming consumption and government expenditures constant. It is know that saving and investment are equal so investment will also increase leading the short run …

According to Okun’s law, the relationship between real GDP and unemployment is negative. Following equation summarizes the Okun’s law:                    The above equation shows that moving direction of output is opposite from unemployment, and the ratio is 2 to 1. Increase in output in short …

        In the short run, it is assumed that the level of price is fixed and the curve of aggregate supply is flat. Hence, the output increases in the short run when Fed increases the money supply but the level of price remains same. In the long run, the curve of …

    If the Fed increases the money supply by 7 percent then the aggregate demand curve will be shifted upward. This happens due to the quantity theory of money:                                              …

        The decrease in money supply will cause the increase in rate of interest that will eventually decrease investment spending in the economy leading to further decrease in other spending of consumers and this process keep going. Furthermore, the decrease in money supply will cause the decrease in quantity demanded of …

        The opportunity cost is one of the most important concepts of microeconomics. It is the benefit that the decision maker loss by choosing another option. The opportunity cost is referred as the cost of cost of alternative when one activity is chosen over another. It is also considered as the …