Exploring Macroeconomics
8th Edition
ISBN: 9781544363332
Author: Robert L. Sexton
Publisher: Sage Publications
expand_more
expand_more
format_list_bulleted
Question
Chapter 15, Problem 11P
To determine
To explain:
The reason for increase in planned investment increases the real GDP, but an unplanned increase in inventory investment decreases it.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
What would an increase in planned investment increases real GDP, but an unplanned increase in inventory investment decrease real GDP in the aggregate expenditure model?
What are the equations for the consumption, net exports, and aggregate expenditures functions?
Why can’t an economy with an MPC greater than 1 reach a stable equilibrium in the aggregate expenditure model?
Knowledge Booster
Similar questions
- Calculate the value of consumption expenditure from the following:- National income = $6000 Autonomous consumption = $1000 Marginal propensity to consume = 0.80arrow_forwardCalculate autonomous consumption expenditure from the following date about an economy which is In equilibrium.National income = Rs. 1,100Marginal propensity to save = 0.20Investment expenditure = Rs. 80(Autonomous Consumption Expenditure = 120arrow_forwardThe multiplier model: Consumption spending refers to ________ spending on goods and services.arrow_forward
- At a aggregate output level of $200 billion what is planned aggregate expenditure?arrow_forwardThe life cycle model of consumption argues that people consume and save in different proportions as they age. Seniors tend to consume more than save as their lives adjust to the realities of old age. Assuming the hypothesis is true, how would the aging of the very large baby boomer generation affect consumption and income?arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
- Exploring EconomicsEconomicsISBN:9781544336329Author:Robert L. SextonPublisher:SAGE Publications, IncEconomics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Exploring Economics
Economics
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:SAGE Publications, Inc
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning