why did many government introduce "austerity" policies after the 2008/2009 financial crisis eventhough their economies were exhibiting recessionary GDP gaps and unemployment was high, and despite the fact that keynesian economics suggested that governments should do the opposite

Q: rice level and output are affected in the short-run. b) Can the government use fiscal policy to…

A: a. A recession is when there is a significant decline in general level of economic activity being in…

Q: H0w d0es price stickiness phen0men0n lead t0 an increase in the sh0rt run level 0f 0utput acc0rding…

A: Price stickiness is the resistance of price to change. Price will remain same,irrespective of…

Q: Let's say that our country's Gross Domestic Product is at $15 billion (this year). We also know that…

A: Answer: Given, The gross domestic product this year = $15 billion Full employment level of GDP =…

Q: Question 5 In an OLG model with money: Each gen picks 12 banans when young, 0 bananas when old.…

A: The OLG model is framework for the study of: (a) the life-cycle ( Human Capital Investment),…

Q: When the economy is in an inflationary gap, using relevant diagrams show whether the economy should…

A: There are different views regarding economic principles. Keynesian school of thought and the…

Q: The tax cuts of 2017 increased the 2018 disposable income of households by roughly $200 billion. If…

A: In economics, the marginal propensity to consume (MPC) is defined as the proportion of an aggregate…

Q: In the simplest version of the Keynesian model, income is determined by: O A. consumer spending. O…

A: When talking about Keynesian model, it beleives in expenditure method to compute the national income…

Q: What is supply-sice or "trickle-down" economics? Why do Keynesians reject supply-side economics?…

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Q: 11- an increase in AD might be cause by improving technology in manufacturing processes. -false?…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: The figure given below depicts the macroeconomic equilibrium in a country. Figure 11.3 AS, 400+ 200+…

A: Aggregate demand is a macroeconomic concept and can be defined as the sum total of the final value…

Q: ncome... a) ICOR (Incremental Capital-Output Ratio) b) Aggregate demand c) Multiplier d) All answers…

A: The commodity relationship between the quantity that the consumers are willing to buy and that…

Q: 7. Explain why Keynesian economists are more likely to favor governmental interventions in markets.…

A: In honor of British economist John Maynard Keynes (1883–1946), who is widely considered as the…

Q: Chapter 11: Aggregate Demand I: Building the IS-LM Model Question: The Keynesian model suggests that…

A: Keynes emphasised on fiscal government intervention. He stated that without government sending it is…

Q: According to Keynes, the government may fight unemployment by raising its budget deficit O…

A: Option D All of the above Keynesian economists believe that both expansionary fiscal and…

Q: a) State carefully the key assumptions underlying the Keynesian model of the economy. b) Using the…

A: Keynesian Economics is defined as that branch of economics which emphasizes on the use of government…

Q: Suppose that the government budget is balanced (balanced-budget) in the context of the Keynesian…

A: Here, it is given that the economy has a balanced government budget according to Keynesian model.

Q: Explain with a diagram how did Keynes use fiscal policy as a tool to help with economic recovery…

A: Money supply is the total amount of money in circulation in the economy i.e. with the people and in…

Q: 1Why low rate inflation is considered necessary for economic grwoth? Oa It does not affect the…

A: Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: En Santiago, la oferta y demanda del sector automotriz son Q. = 60 + 5P (0ferta) Qo = 120 – 7P…

A: Dado que ha publicado una pregunta con varias subpartes, resolveremos las tres primeras subpartes…

Q: his p

A: Price stickiness is the tendency of prices despite of the changes in the cost of producing and…

Q: (a) You are the economic adviser of Keyneslanding, the president calls you into her office and says…

A: C= 100 + 0.75 Yd G= 100 T= 100 Y = 900 T'=200 G'=200

Q: What is the key difference between the IS-MP-PC model and the AD/AS model? O In AD/AS model, the…

A: IS-MP-PC model stands for The Income Spending - Monetary Policy - Phillips Curve model.

Q: Discuss the main differences between Keynesian school with those of the Neo-Classicists.

A: Macroeconomics is a part of economics that deals with production, decision and allocation concerning…

Q: Suppose that the economy has a recessionary gap. In order to correct this, policymakers would want…

A: A gap arises when there is a disparity between real GDP and potential GDP at full employment.  When…

Q: The Thai economy is at its potential level. Illustrate and explain the impact of the Covid-19…

A: Since this particular question has multiple parts and the first two parts are research based, we…

Q: Given all the complications that can result wwith fiscal policy, is fiscal policy still considered…

A: Lets just first understand  the concept of Sustainability Policy. The stabilization goal aims to…

Q: Use the dynamic AD-AS model to describe the impact of the crisis on the economy. Be sure to comment…

A: Economic crisis: It refers to the quick and sudden change in the economy which results in the…

Q: The equilibrium levels of income 1Consumptiion C, disposable in come Yo and taxation T for a three-…

A: Answer to the question is as follows :

Q: "H0w w0uld y0u define price stickiness ? H0w d0es this phen0men0n lead t0 an increase in the sh0rt…

A: Price stickiness refers to market prices' resistance to vary quickly despite the broad economy…

Q: 26. if rr = 2000.c= 2000, ER = 6000, DD = use M1, the Md in Keynes and value of money in pigou are…

A: Keynes Model is a model in Macroeconomics that discusses about total spending in the economy and its…

Q: rom the economic Keynesian perspective, what do you think about it? In your post, be sure to…

A: The Keynesian economics marks the dramatic departure from the classical economics. The keynesian…

Q: 24) In the simple Keynesian model, if there is an autonomous investme falls by $20 billion and the…

A: The investment is the summation of induced investment and autonomous investment. The autonomous…

Q: xplain the keynesian theory of high public spending to stimulate economic grow

A: To get some more context, it is important to understand the evolution of economics. The dominant…

Q: Introducing Keynesian Economics" says that Keynes A: - wanted social revolution just like Marx -…

A: Classical economics developed around the 18th and 19th centuries. Classical economists believed in…

Q: Course: Macroeconomic - IS-LM Model Prove mathematically the following: Given an increase in the…

A: Given:  IS-LM Model There is increase in the proportional tax on income(t).

Q: hello, so ive already asked this question but i dont understant the answer that i was given. This is…

A: Answer: First of all, I am providing you my answer then I will explain your query: The given…

Q: The permanent income hypothesis and the Ricardian equivalence theorem Select one: O a. are the same…

A: Ricardian proportionality is a monetary hypothesis that says that funding government spending out of…

Q: 2. Assume that in 2011, the following prevails in the Republic of Nurd: Y = $200 G - $o a C = $160…

A: d) Y = C + I + (G – T) Putting the values, 200 = 160 + 40 + 0 200 = 200 Hence, the economy is in…

Q: Aggregate Demand I: Building the IS LM Model-End of Chapter Problem Although our development of the…

A:

Q: Suppose that the government reduces the lump-sum tax, and suppose that gov- ernment always has a…

A: Given:- Government reduces lump-sum tax Government has a balanced budget Please find the images…

Q: If the marginal propensity to consume is 0.75, byhow much would government spending have to rise…

A: Expenditure multiplier shows the magnitude of how much real output will change in response to an…

Q: (47). If the federal budget were balanced annually O. monetary policy would become the chief tool…

A: Since you have asked multiple question, we will solve the first question for you . If you want any…

Q: 15. If the MPC is 3/4, what is the government spending multiplier in the simple Keynesian model?

A: Given  MPC = 3 / 4 MPC = 0.75