Why cant an economy with an MPC greater than 1 reach a stable equilibrium in the aggregate

Question:

Why can’t an economy with an MPC greater than 1 reach a stable equilibrium in the aggregate expenditure model?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Exploring Economics

ISBN: 9781544336329

8th Edition

Authors: Robert L. Sexton

See More Books

Question Posted: Jan 20, 2023 01:36 AM

See More Questions

In the aggregate expenditure model, why is it important to know the factors that determine consumption spending, investment spending, government purchases, and net exports?
True or False: 1. The aggregate expenditure model is best seen as a model of aggregate demand, and not a complete model of the economy. 2. The components of aggregate demand depend on the price...
Which of the following does the aggregate expenditure model seek to explain: long-run economic growth, the business cycle, inflation, or cyclical unemployment?
Use the following transactions to answer the questions. Use a 6% sales tax rate. Total and rule the sales journal. Jan. 3 Sold merchandise on account to J. J. Johnson, $1,500, plus sales tax. 7 Sold...
The Census Bureau's Current Population Survey shows 28% of individuals, ages 25 and older, have completed four years of college (The New York Times Almanac, 2006). For a sample of 15 individuals,...
Gold, Inc., is an accrual basis player. In 2018, an employee accidentally Communications spilled hazardous chemicals on leased property. The chemicals destroyed trees on neighboring property,...
A negatively charged particle is held in position and then released in a region where a uniform magnetic field points in the positive $x$ direction and a uniform electric field points in the...
Zippy, a regional convenience store chain, maintains milk inventory by the gallon. The first months milk purchases and sales at its Columbus, Ohio, location follow: Nov. 2 Purchased 11 gallons @...
Marshall's concept of external economies and diseconomies refers to: a) Changes in output resulting from changes in input levels b) The effects of production on the environment c) The benefits or...
Why would an increase in disposable income increase induced consumption but not autonomous consumption?
What would happen to equilibrium income if, other things being equal, imports increased by $100 billion and the marginal propensity to consume was 0.9?
As of May 2016 the U.S. government owes $19,190,059,553,782. To whom does the U.S. government owe money? The list is shown below (in $billions). Use a graphical technique to depict these figures....
Question #1: Complete Table 1 after going through the datasheet of the specified microcontrollers. Table 1 Specifications ATMega328P STM32F401RE STM32F412ZGT6 ATMega2560 PIC24FJ64GA004 Architecture...
Part B: Project Evaluation (Total 55 marks) Asif Enterprise Ltd produces Steel scaffolding structures for domestic residential property markets. Due to high demand they have decided to extend their...
Zulu Ltd manufactures a single product whose cost structure is given below: Sh Sh Direct materials: Material ABA (2 kg @ Sh 25 per kg) Material BCA (3 litres @ Sh 75 per litre) Direct labour (4 hours...
(Corporate income tax) Last year Sanderson, Inc. had sales of $3.6 million. The firm's cost of goods sold came to $2.2 million, its operating expenses excluding depreciation of $99,000 were $408,000,...
Problem 3: An accountant, Keepallyer Munny, had been losing business to a competitor down the street because of TV ads put out that said the lines were too long and the turnaround time was to slow at...
What are the steps in the market research process?
You continue to work in the corporate office for a nationwide convenience store franchise that operates nearly 10,000 stores. The per- store daily customer count (i.e., the mean number of customers...
Briefly explain whether each of the following statements describes a change in supply or a change in quantity supplied. a. To take advantage of high prices for snow shovels during a snowy winter,...
Briefly explain whether each of the following statements describes a change in supply or a change in quantity supplied. a. To take advantage of high prices for snow shovels during a snowy winter,...
According to a news story about the International Energy Agency, the agency forecast that the current slide in [oil] prices wont [reduce] global supply. Would a decline in oil prices ever cause a...
A house owner is debating whether she should install drainpipes around her house to protect her house against heavy rains. The heavy rains tend to leak into the basement of the house. In the next...
Blake Accounting pays Brooke Peet $93,600 per year. Assume that Blake's accountants are expected to work a total of 6,000 direct labor hours in 2024. Blake's estimated total indirect costs are...
Question 6 4 pts MEF Corporation had $600,000 in net income for the year ended December 31, 2018. What is Earnings per Share (in dollars and cents) if the company had 200,000 shares of common stock...

Why cant an economy with an MPC greater than 1 reach a stable equilibrium in the aggregate

Question:

Step by Step Answer:

If MPC was greater than one the a...View the full answer

Exploring Economics

Students also viewed these Business questions