The Classical and Keynesians models treat savings completely different. a.In the Keynesian model what happens to
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Question:
- The Classical and Keynesians models treat savings completely different.
- a.In the Keynesian model what happens to the economy when savings increases?
- b.In the Classical model, what happens to the economy when savings increases. (Hint:In the Classical model financial markets must clear. So, savings and investment must be equal.)
Expert Answer:
Answer In the Keynesian model when savings increase it can lead to a decrease in overall economic ac... View the full answer
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