How does autonomous consumption fit into the consumption equation?
Answer to relevant QuestionsAccepting the absolute income hypothesis, would you expect the MPC in the U.S. economy in 2011 to be higher, lower, or about the same as the MPC in the Haitian 2011 economy? Why? How would it compare to the MPC in the U.S. ...What factors determine autonomous investment? For each of the three income levels shown, pro vide appropriate data to satisfy or be consistent with the absolute and relative income hypotheses. The creation of unwanted inventories or the depletion of wanted inventories signals coming changes in the level of national income. Explain. Imagine an economy with the consumption function C = $100 + 0.90Y. Now consider four scenarios of intended investment: (1) I i = $100, (2) I i = $150, (3) I i = 250, and (4) I i = 350. Calculate the equilibrium levels of ...
Post your question