Summary
Summary ECON112: CHAPTER 6: AGGREGATE EXPENDITURES
- Course
- Institution
a hand notes with glossary, practice questions and exercises, formula, and more
[Show more]
Seller
Follow
JustNotes
Content preview
1) Which spending included hypotheticaltypes of are in a
private ,
closed economy
?
Consumption ,
Investment
2) 8he amount that ppl spend regardless much
of how income
they earn is
referred to as autonomous spending
3) 8th increase in
spending that results from a
higher income
is
referred to as induced
spending .
4) When does expenditure equilibrium occur
:
↳ when
aggregate expenditure =
national income
•
AE > National income
inventories ¥
•
AE < National income
inventories $ ( surplus )
5) When National income is above equilibrium
Rehe AE
faction below the Y AE line
• =
is
•
Injections are below leakages .
,Aggregate
Expenditures
, Autonomous ( expenditures )
spending
↳ 8ha portion
of total
spending that is
the
independent of level
of income .
↳ is the absolute minimum level
of spending
that occurs .
Induced spending
↳ a
good portion of consumption is induced
by higher income levels .
( MBC )
Marginal propensity to consume
↳ Rehe extra
proportion of consumer
spending that results
from higher income
( MIS )
Marginal propensity to save
↳ the ratio
of the
change in
savings to the
corresponding change in income .
Marginal propensity to expend ( MRE )
↳ Dhe ratio
of change in expenditures that results
from a
change in income .
Wealth
effect
↳ tone direct
effect of a change in wealth on
consumption spending
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller JustNotes. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $9.48. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
79373 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now