The percentage of income that is consumed
The percentage of income that is not saved
One minus the fraction of total disposable income that is saved
The Keynesian analysis of aggregate demand indicates that changes in the money supply
Have no effect on aggregate demand
Shift the aggregate demand curve in the opposite direction of the change in government spending
Shift the aggregate demand curve in the same direction as the change in government spending
Move the economy along the aggregate demand curve rather than shifting it
The aggregate demand curve is downward sloping because
A lower price level, holding the nominal quantity of money constant, leads to a larger quantity of money in real terms causes the interest rate to fall, and stimulates planned investment spending
A lower price level, holding the nominal quantity of money constant leads t a larger quantity of money in real terms, causes the interest rate to fall, and stimulates planned investment spending
A higher price level, holding the nominal quantity of money constant
A higher price level holding the nominal quantity of money change
The macro economic thinking was revolutionized by
David Ricardo
J.M. Keynes
Adam Smith
Malthus
Aggregate supply is the total amount
Produced by the government
Of goods and services produced in an economy
Of labour supplied by all households
Of products produced by a given industry
The consumption function relates the consumption expenditure decisions of households to
Investment decisions of firms
The level of disposable income
Saving decisions of households
The nominal interest rate
The Marginal Propensity to Consume
ΔS/ΔY
C/y . ΔP/ΔQ
ΔP/ΔQ
ΔC/ΔY
The accelerator theory of investment says that induced investment is determined by:
The rate of change of national income
The level of aggregate demand
Expectations
The total quantity of an economy's final goods and service demanded at different price levels is
The aggregate supply curve
The aggregate demand curve
The Phillip's curve
The aggregate expenditure function
The most important determinant of consumption and saving is the:
Level of bank credit
Level of income
Interest rate
Price level
