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!
Q. Describe about consumption function?
The consumption function
Consumption C(r) is assumed to be negatively related to the real interest rate r
Aggregate demand for consumer goods is stated as total amount of finished services and goods that households wish to buy under different conditions. There is not any specific supply of consumer goods - firms offer final goods however do not distinguish between supply to consumers, supply to investors and supply to foreigners.
We have used the symbol C for observed consumption. To be consistent with the notation we must denote the demand for consumer goods by CD. Though this isn't common practice in macroeconomics. In its place symbol C is used for the demand for consumer goods as well. Luckily, it's almost always obvious from the context if symbol C represents the observed consumption - it's then a variable - and when C signifies the demand for consumer goods - it is then a function.
Furthermore, the term 'demand for consumer goods' is frequently shortened to the 'demand for consumption' or simply 'consumption'. Whenever you see 'consumption', you need to figure out if it means observed consumption or consumption demand.
In the classical model, demand for consumption is presumed to be negatively related to real interest rate r. higher real interest rates makes it more expensive to borrow money for consumption today. In the same way, it will be more favourable to postpone consumption to the future.
Consumption is hence denoted by C(r) and this notation makes it clear that we are talking about demand for consumption and not observed consumption.
The U.K. produces and imports eggs. Suppose that the government imposed a quota on imports: Foreign suppliers could export no more than Q eggs (regardless of price). What effect do
1. An innovator, who creates new products and new ways to get business done, is referred to as: Select one: a. A manager. b. A capitalist. c. An entrepreneur. d. A creditor. 2
Address the following issues concerning technological and strategic barriers to entry. (a) Explain the role of economies of scale and (long run) fixed costs as technological bar
A recent article estimated that the elasticity of the rate of gonorrhea with respect to the price of beer is about 0.8. If this estimate is correct, are unprotected sex and beer su
Use the following data on a firm's total cost schedules to calculate its average variable cost, average fixed cost, average total cost, and marginal cost schedules. Output Total
Will improving customer service result in higher stock prices for the companies providing the better service? When a companys satisfaction score has improved over the prior years r
Hello sir, madam... I am hassan PHD student. I''m lost to get a good frame work of my thesis about e government and economic growth. and I need to know how to measure the variable
An example of direct foreign investment is given by: a. The sale of U.S. government bonds to foreigners. b. The sale of U.S. stocks (equities) to foreigners. c. A multinational cor
x=40-0.2p where x=x1+x2 c1=50+2x1+0.5x1 c2=100+10x2
Suppose that a widget market is described by the following supply and demand equations. Supply: Q = 3 P Demand: Q =400 - P a. Solve for the equilibrium price and the
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