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Why does all of the savings in the economy create an equal amount of investment spending according to neoclassical theory and Keynesian model?
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According to keynes which of these factors determined the income of the people?
Consumption, Investment, and Government spending
Advantage and disadvantage of keynesian theory?
Disadvantages: -crowding-out effect -time-lag -deficit spending
What economic theories supports an increase in government spending in order to benefit private industries?
Keynesian theory
Does the keynesian framework argue that the government should play a key role in offsetting fluctuating spending by the business sector?
yes
The theory that government spending should increase during business slumps and curbed during booms is referred to as?
Keynesian Economics
What causes a difference between desired spending and income in the monetarist model in the Keynesian model?
In the monetarist model, a difference between desired spending and income is caused by either an excess demand for money (MD > MS) or an excess supply of money (MS > MD). An excess demand for money reduces desired spending, and an excess supply increases it. In the Keynesian model, changes in desired spending (particularly in desired investment spending) cause the difference.
According to keynes which of these factors determined the income of the people?
Consumption, Investment, and Government spending
Advantage and disadvantage of keynesian theory?
Disadvantages: -crowding-out effect -time-lag -deficit spending
What economic theories supports an increase in government spending in order to benefit private industries?
Keynesian theory
What is the most likely result of an increase in interest ratesĀ a. investment spending risesĀ b. investment spending fallsĀ c. the economy speeds upĀ d. unemployment falls?
b. investment spending falls
Does the keynesian framework argue that the government should play a key role in offsetting fluctuating spending by the business sector?
yes
The theory that government spending should increase during business slumps and curbed during booms is referred to as?
Keynesian Economics
Which of these statements is fundamental part of keynesian economics?
The government can use deficit spending to increase aggregate demand and pull the economy out of recession.
To pay for the new deal programs roosevelt abandoned a balanced budget and began using?
... deficit spending as recommended by Keynesian Economics.
What statements is a fundamental part of Keynesian economics?
The government can use deficit spending to increase aggregate demand and pull the economy out of recession.
How did economic events during world war ii demonstrate the principles of keynesian economics?
Economic events during World War II demonstrated the principles of Keynesian economics in the sense that spending had gone done dramatically and the economy was stalled.
What is the private investment multiplier?
the private investment multiplier is the change in national income resulting from a change in private investment spending
