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Total income depends on total employment which depends on effective demand which in turn depends on consumption expenditure and investment expenditure. Consumption depends on income and propensity to consume. Investment depends upon the marginal efficiency of capital and the rate of interest.
J. M. Keynes made it clear that the level of employment depends on
aggregate demand and aggregate supply. The equilibrium level of income
or output depends on the relationship between the aggregate demand
curve and aggregate supply curve. As Keynes was interested in the
immediate problems of the short run, he ignored the aggregate supply
function and focused on aggregate demand. And he attributed
unemployment to deficiency in aggregate demand.
What else can I help you with?
What is the price level assumed to be in the simple Keynesian model of determination of income?
exogenous and constant
What is the Difference between price theory and income theory?
Price theory can be referred to as Micro economics and income as Macro.
The theory of wages are based on supply and demand for a worker's skills is called what theory?
market theory of wage determination.
What are the criticism of classical theory of output and employment?
its introduced by classical economist, there are basically two way to examine classical theory, they are 1 determination of employment 2 determination of output
What is income determination?
Income determination refers to the process of establishing the level of income for individuals, businesses, or economies based on various factors such as production, consumption, and market demand. It often involves analyzing how resources are allocated and how different economic activities contribute to overall earnings. In macroeconomics, income determination is crucial for understanding economic growth, employment levels, and fiscal policies. Various models, such as the Keynesian and classical theories, offer different perspectives on how income is generated and distributed within an economy.
What is the price level assumed to be in the simple Keynesian model of determination of income?
exogenous and constant
What is the Difference between price theory and income theory?
Price theory can be referred to as Micro economics and income as Macro.
The theory of wages are based on supply and demand for a worker's skills is called what theory?
market theory of wage determination.
Self-determination theory?
autonomy, competence and connection
What are the criticism of classical theory of output and employment?
its introduced by classical economist, there are basically two way to examine classical theory, they are 1 determination of employment 2 determination of output
The theory of wages are based on supply and demand for a worker's skills is called what?
market theory of wage determination.
What is income theory?
Income theory is a branch of economics that studies how individuals and households earn income through factors like wages, investments, and entrepreneurial activities. It seeks to explain patterns of income distribution within a society and how these patterns impact economic outcomes and societal well-being. Various economic models and approaches are used to analyze income theory, including the neoclassical theory of income distribution and theories of income inequality.
What is income determination?
Income determination refers to the process of establishing the level of income for individuals, businesses, or economies based on various factors such as production, consumption, and market demand. It often involves analyzing how resources are allocated and how different economic activities contribute to overall earnings. In macroeconomics, income determination is crucial for understanding economic growth, employment levels, and fiscal policies. Various models, such as the Keynesian and classical theories, offer different perspectives on how income is generated and distributed within an economy.
How does the market theory of wage determination reflect the forces of supply and demand?
True
What is euclids theory?
need a simple explanation of Euclids theory.
The theory that the level of investment depends on the rate of national income-is known as?
the"Accelerator theory of Investment"
Scope of micro and macro economics?
theory of income and employment: theory of general price level and inflation theory of economics macro theory of distribution' theory of international trade
