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Government revenue, government spending and net exports
G, NT and NX are exogenous variables in the classical model
In the classical model (and in most macroeconomic models) government spending and net taxes are presumed to be exogenous variables determined by the government.
Net Exports NX is also an exogenous variable that means both imports Im and exports X are exogenous variables. Exports are determined by rest of the world and this variable is exogenous in most macro models. It's possible to presume that imports depend on real interest rate by the same arguments we used for consumption. It would be possible to modify classical model such that imports depended on real interest rate though results would be largely the same. Consequently we presume that imports are exogenous as well.
(40 points) Consider two consumers, A and B. A and B both want perfect consumption smoothing (c = cf) and both have no current wealth. However, the two consumers have different inc
Whenever real GDP declines, nominal GDP must also decline
given the consumer maximizing problem subjest to consumption, the firm''s maximizing problem subject to revenue as a function of labour demand, and the government''s budget as G=T.
compare and contrast the monetarism economics and the keynesian economics
The sales counter next to the soft toy display in Shambles receives a customer every 2-4 minutes. Most of these customers (80%) are buying toys and are dealt with by the cashier i
What are the Responsibilities of central banks Responsibilities include providing banking services to commercial banks and the government and regulating financial markets and i
Once Y is determined, almost all of the other variables are determined since they are either exogenous or they depend on Y. From Y we can determine C by consumption function, I m
Could you please tell me an example and describe example of macroeconomics?
explain the effects of various injections and withdrawals and show the equilibrium in the circular flow
If you were a restaurant owner and you knew that the demand for your restaurant was elastic, how would you feel about a sales tax on restaurant food? Explain.
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