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The notion of trickle-down is that increased credit or funds at the disposal of those least in material need willlead to increased economic activity because, their personal needs being already met, they will invest the money speculatively rather than merely spend it (as less wealthy people would) on basic consumption. The resulting growth in economic activity will "trickle-down" to those lower on the economic scale through the increased demand for goods and labor that expansion brings. The central proposition of "trickle-down" theory is that this is a more efficient and effective way to generate economic growth and widespread prosperity than alternative strategies such as (but not limited to) increasing credit or funds for people with lower incomes as they will spend more of it, stimulating growth through demand for goods and services.
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What does the Keynesian economic theory suggest?
That the government oversee and regulate the balance of the economy.
What is the difference between Keynesian and classical economic theories?
Keynesian economic theory focuses on government intervention to manage economic fluctuations, while classical economic theory emphasizes a hands-off approach with minimal government involvement in the economy.
A theory that states it is healthy for the economy if the government is involved in setting economic policy is called?
Laissez-faire
Why is the study of macro Economic theory important for finding solution to the Macroeconomic problems of the economy?
The study of macroeconomic theory is crucial for understanding the complex interactions within an economy and identifying the root causes of macroeconomic problems such as inflation, unemployment, and economic growth. By analyzing aggregate indicators and economic policies, policymakers can develop targeted strategies to stabilize the economy and promote sustainable growth. Additionally, macroeconomic theory provides a framework for predicting potential economic outcomes, enabling better decision-making and resource allocation. Ultimately, it equips stakeholders with the tools to address challenges and foster a resilient economic environment.
What is economic decoupling?
It is a theory wherein a lesser emergent economy , is able to continue its trajectory of constant growth irrespective of whether a more mature , older , established economy goes into decline or recession. The theory postulates that the larger economy, will not draw the emergent economy off its established path of growth, neither will it be sucked into its wake.
Under this economic theory the government does not get involved in the economy?
Laissez-Faire
Under this economic theory the government does not get involved in the economy.?
Laissez-Faire
What does the Keynesian economic theory suggest?
That the government oversee and regulate the balance of the economy.
What is the difference between Keynesian and classical economic theories?
Keynesian economic theory focuses on government intervention to manage economic fluctuations, while classical economic theory emphasizes a hands-off approach with minimal government involvement in the economy.
A theory that states it is healthy for the economy if the government is involved in setting economic policy is called?
Laissez-faire
What economic theory is characterized by market competition and private ownership?
free market economy. think america
Why is the study of macro Economic theory important for finding solution to the Macroeconomic problems of the economy?
The study of macroeconomic theory is crucial for understanding the complex interactions within an economy and identifying the root causes of macroeconomic problems such as inflation, unemployment, and economic growth. By analyzing aggregate indicators and economic policies, policymakers can develop targeted strategies to stabilize the economy and promote sustainable growth. Additionally, macroeconomic theory provides a framework for predicting potential economic outcomes, enabling better decision-making and resource allocation. Ultimately, it equips stakeholders with the tools to address challenges and foster a resilient economic environment.
What is economic decoupling?
It is a theory wherein a lesser emergent economy , is able to continue its trajectory of constant growth irrespective of whether a more mature , older , established economy goes into decline or recession. The theory postulates that the larger economy, will not draw the emergent economy off its established path of growth, neither will it be sucked into its wake.
As the leader of the Chicago School Milton Friedman became associated with what economic theory based on controlling the supply of money in an economy?
Monetarism
What is centrally planned economy with all economic with all economic and political power resting in the hands of the central government?
A centrally planned economy with all economic and political power resting in the hands of the central government is known as communism. Karl Marx developed communism into a scientific theory.
What are the assumptions of liberalism theory in international political economy?
Liberalism theory in international political economy assumes that states are rational actors in pursuit of their self-interest and are driven by economic motives. It also assumes that international institutions can facilitate cooperation among states and promote economic interdependence. Additionally, liberalism theory assumes that free trade and open markets benefit all participating states.
What has the author Aleksandr Ivanovich Anchishkin written?
Aleksandr Ivanovich Anchishkin has written: 'The theory of growth of a socialist economy' -- subject(s): Economic development, Marxian economics, Economic conditions
