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In an individual industry its own price level depends partly on rates

Compensations of factors of the production which are a part of incremental costs

Productions, and partly from production scales. There are no bases

To change this conclusion when we pass to the industry as a whole. The general

The price level depends partly on fee rates of factors of production, A part incremental costs of production, and partly from scales

Productions as a whole, i.e. (Accepting a condition of engineering and technology for

Given) from employment volume. However, when we pass to production in Whole production costs in any branch partially depend from

The sizes of issue in other branches. But the most important change, with which

We should be considered, is an influence. Demand changes as on costs, and

On a volume of output. When we speak about demand as a whole, instead of about demand on

The one and only separately taken goods in the conditions of the invariable general

Demand, we should enter a number of absolutely new ideas into the analysis.


If to afford simplification, having assumed that fee rates The various factors of production which are a part of incremental costs, all Are changed in an identical proportion, i.e. The same proportion, as unit Wages then it will appear that an overall price level (accepting a condition Technicians and technologies for given) depends partly on wages unit And partly from employment volume. Hence, effect of changes in

Quantity of money for a price level it is possible to consider as consisting of

Effects per unit of wages, on the one hand, and from effect On employment - with other.

More particularly to imagine business, we will simplify our assumptions Even more also we will assume that) first, all not used resources Are homogeneous and have efficiency equal one another by production of all The required goods also that, secondly, all entering into incremental costs Production factors are content with the same monetary payment, while It is available there is their not used surplus. In this case we would have Constant yield and motionless unit of wages until then, While there is a partial employment at least one factor. From here follows,

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