1) Explain why national income figures cannot be used accurately to measure people's standard of living. 2)...
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Question:
1) Explain why national income figures cannot be used accurately to measure people's standard of living.
2) Discuss Milton Friedman's permanent income hypothesis and differentiate it from the life cycle hypothesis and differentiate it from the permanent income hypothesis.
3) The following information is from the national income accounts of country
Y = C+I+G+(XM)
C = 20+0.8 yards
T = 30
sol = 22
X = 20
M = 4+0.3Y
Yd = YT
yo=30
i) From the above model, list all the endogenous and exogenous variables.
ii) Determine the equilibrium values for all endogenous variables.
Related Book For
Economics Principles and Policy
ISBN: 978-0538453653
12th edition
Authors: William J. Baumol, Alan S. Blinder
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