question
short-run fluctuations in the business cycle:
answer
keynesian model, the PPF and LRAS remain constant in the short run, wages and prices are sticky
question
aggregate expenditures
answer
GDP = AE = C + I + G + (X - M)
question
keynesian consumption function
answer
C = A + MPC(Yd)
question
saving formula
answer
S = -A + MPS(Yd)
question
average propensity to consume
answer
percentage of income that is used for consumption (C/Y)
question
average propensity to save
answer
percentage of income that is saved (S/Y)
question
marginal propensity to consume
answer
change in consumption/change in income
question
marginal propensity to save
answer
change in savings/change in income
question
macroeconomic equilibrium
answer
Y = (1/(1-MPC))(A + Ip)
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