Is consumption depend on GDP in the cross model, Macroeconomics

Assignment Help:

Q. Is Consumption depend on GDP in the cross model?

Aggregate demand

The consumption function

Consumption C(Y) depends positively on GDP in the cross model

Remember that in classical model, consumption relies on the real interest rate. In cross model it relies on GDP. Note that it isn't possible to include r in the cross model as it is fixed. Though, we need to justify the dependence of C on Y.

Related Discussions:- Is consumption depend on GDP in the cross model

Labor Economics, Assume Workers Comp awards $X to workers not working becau...

Assume Workers Comp awards $X to workers not working because of injury. $X is set to equal the workers previous wages. Once workers return to work, the award payments stop. Suppose

Define price elasticity of demand, Suppose arm's demand curve is given by P...

Suppose arm's demand curve is given by P = 120? Find the (value of) price elasticity of demand (point elasticity) for the demand curve when the price is $100. Is demand elastic or

Classical model, using a graph of the classical labour market, illustrate t...

using a graph of the classical labour market, illustrate the effects of a real wage existing in the market that is lower than the equilibruim real wage.what will eventually happen

Illustrate the problem for economic performance, Illustrate the problem for...

Illustrate the problem for UK economic performance This is a foremost problem for UK economic performance and helps elucidate the persistent deficit on the current account of

Trade cycle, policy measures to control trade cycle

policy measures to control trade cycle

Gpd., the whole explanation of dpd

the whole explanation of dpd

Economy could become stuck, According to Keynes, the economy could become s...

According to Keynes, the economy could become stuck at a low income level if: A. aggregate demand and aggregate supply are independent of one another. B. declines in aggregate dema

Classical labour market, effects of real wage existing in the market that i...

effects of real wage existing in the market that is lower than the equlibrium real wage.what will happen in this labour market if it is perfectly competitive

Help, i want an answer for my q Question 3 (5 marks) Most studies of firm...

i want an answer for my q Question 3 (5 marks) Most studies of firms’ long run costs have found that average costs decline as firms produce increasingly larger output levels (eco

Why the group is considered powerful, Evaluate your workplace and identify ...

Evaluate your workplace and identify a group that has "power" in the organization. Analyze why the group is considered powerful. a. What are the elements that contribute to the gro

Write Your Message!

Name

Email id

Message

Verfication Code

User Account

All Pages