Explain reversed say''s law, Macroeconomics

Assignment Help:

Q. Explain Reversed Say's Law?

In the cross model, supply should instead follow demand. Cross model not only rejects Say's Law, it turns it entirely upside down. In the cross model 'demand creates its own supply'. 

Just as Say's Law is criticized by many economists, there is criticism of this reversed form of Say's Law. Firms passively produce exactly what consumers want. If there is an increase in demand, firms would just produce this extra quantity. Motivation for this behaviour by the firms is further analysed when we describe the labor market in the cross model.


Related Discussions:- Explain reversed say''s law

Trade unions, what reasons limit the bargaining power of trade union in dev...

what reasons limit the bargaining power of trade union in developing countries

Permanent income, assuming that B=0.33 Y1998=[0.33]Y1998 Estimate the perma...

assuming that B=0.33 Y1998=[0.33]Y1998 Estimate the permanent income for 1998

Relate overnight interest rates targets with money supply, Relate Overnight...

Relate Overnight interest rates targets with money supply There are many ways to explain the important connection between the overnight interest rate target and the money suppl

What does macroeconomics mean, The study of the overall aspects and working...

The study of the overall aspects and workings of a national economy is like as income, output, and the interrelationship between diverse economic sectors. It is the study of all as

What is modifications to a polymer, What are three modifications to a polym...

What are three modifications to a polymer that can make it transparent? How will these modifications affect the mechanical properties of the polymer?

Keynesian dyanamic multilpier, what is static and dynamic multiplier in key...

what is static and dynamic multiplier in keynesian theory?

Government and price-determination, Government and Price-Determination can ...

Government and Price-Determination can be understood as follows: The government might intervene in the market and mandate the maximum price (price ceiling) or the minimum price

Public sector, Are there any current subsidy or welfare issues that are bei...

Are there any current subsidy or welfare issues that are being discussed or addressed in parliament or in municipalities

Neoclassical view, Roles of government in controlling market forces under n...

Roles of government in controlling market forces under neoclassical view

Assignment, derive the isoprofit functin

derive the isoprofit functin

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

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!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd