Questions from Macroeconomics

Q: In which factors will a change lead to a change in consumption

In which factors will a change lead to a change in consumption?

Q: According to Keynes, can an increase in saving shift the AD

According to Keynes, can an increase in saving shift the AD curve to the left? Explain your answer.

Q: What does it mean to say that “the market” feeds

What does it mean to say that “the market” feeds Cleveland, Austin, Atlanta, or Indianapolis?

Q: What factors will shift the AD curve in the simple Keynesian model

What factors will shift the AD curve in the simple Keynesian model?

Q: According to Keynes, an increase in saving and decrease in consumption

According to Keynes, an increase in saving and decrease in consumption may lower total spending in the economy. But how could this happen if the increased saving lowers interest rates (as shown in the...

Q: Can a person believe that wages are inflexible downward for, say

Can a person believe that wages are inflexible downward for, say, one year and also believe in a self-regulating economy? Explain your answer.

Q: According to Keynes, can the private sector always remove the economy

According to Keynes, can the private sector always remove the economy from a recessionary gap? Explain your answer.

Q: What does the aggregate supply curve look like in the simple Keynesian

What does the aggregate supply curve look like in the simple Keynesian model?

Q: “In the simple Keynesian model, increases in AD that occur

“In the simple Keynesian model, increases in AD that occur below Natural Real GDP will have no effect on the price level.” Do you agree or disagree with this statement? Explain your answer.

Q: Classical economists assumed that wage rates, prices, and interest rates

Classical economists assumed that wage rates, prices, and interest rates were flexible and would adjust quickly. Consider an extreme case: Suppose classical economists believed wage rates, prices, and...