Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Aggregate demand with inflation
In previous versions of Keynesian model, Components of aggregate demand did not depend on P. In IS-LM and in AS-AD models, investments depended on nominal interest rate R.
We argued that investment in fact relies on the real interest rate r but as R = r when πe = 0, we could make it a function of R.
When πe no longer is zero and real interest rate r = R - πe, we must write I(r) or I(R - πe). We must also write YD(Y, r) or YD(Y, R - πe). As inflation expectations are exogenous (given), it's still the case that YD relies negatively on R. Please note that if there is an equal increase in expected inflation and in nominal interest rate, real interest rate is unaffected and so is aggregate demand andinvestments.
what are the effects of interest rate in the economy of south africa in unemployment, economic groth, employment. and economic growth
What happened to the credit standards (e.g., minimum down payment, mortgage loan relative to the value of the house, and creditworthiness of the borrower) between 1995 and 2005? Wh
TRADE LIBERALISATION UNDER WTO: In the Uruguay Round negotiations, India agreed to reduce tariff on a large number of commodities and remove quantitative restrictions (QRs
Aggregate Supply (AS) We now shift our attention to the supply side of the macroeconomy. Aggregate supply explains the production and pricing side of the economy and the behav
Q. Illustrate the Says Law? With Say's Law, aggregate demand would always be equal to aggregate supply and cross model would be incorrect. Keynes's argument as to why Say's
Suppose that the economy is characterized by the following behavioral equations: C= 170 + 0.7YD I= 170 G= 150 T= 100 a. What does equilibrium output equal? Y=? b. What d
Assume that the demand for running shoes is highly inelastic and the supply curve for running shoes is highly elastic. Suppose that the tastes of the exercising public shift away f
it has been argued that economic development of developing countries has been held back by a persistent fall in the terms of trade of developing countries over the long run
Malthus surmised that "poverty and misery are the natural punishment for the failure by the ‘lower classes' to restrain their reproduction." The policy implication of this viewpoin
Aggregate demand in the cross model Because C and Im depends positively on Y while G, I and X are exogenous, aggregate demand Y D will depend positively on Y: Y D (Y) = C(
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd