English to Persian (Farsi) Bus/Financial Economics economics:banking/finance

Zubair Hasan: (Commentator)
3. Structural Problems
Khan and Mirakhorfo.llOw the comparative static equilibrium technique for pur-
poses of analysis. They specify the relevant sectors of the economy, present a flow of
funds accounts table, and spell out some behavioural relationships. Using these
building blocks, they design a model which essentially is an extension, with some
modifications, of a simple macro economic secular frame. This frame rests on two
markets. First, there is a commodity (including services) market where in equilib-
rium, the savings (5) and investment (I) must equate. Investment is assumed to be an
exogenous factor and savings are taken as a function of aggregate income (Y) and the
rate of interest (t).
Second is the money market, where the equilibrium condition is that the exogen-
ously given money supply (M) is equal to the demand for money. The demand for
money is a function (.) of money income, (P .Y whereP is the price level) and (t)
.the ate of interest. To simplify matters further, it is assumed that P== 1.
Thus, we have a system of two equations