Econ 101: Aggregate Demand and IS-LM Model

GratefulThermodynamics avatar
GratefulThermodynamics
·

Start Quiz

Study Flashcards

20 Questions

What is the relationship described by the consumption function?

What is the purpose of the life-cycle model of consumption?

What is the mirror image of the consumption function?

What does the Permanent Income Hypothesis state?

What does the wealth effect refer to?

What is the focus of this lecture?

According to the Keynesian Cross model, what determines an economy's total income in the short run?

In the IS-LM model, what does a horizontal SRAS curve represent?

Who is credited as the father of macroeconomics in relation to the Keynesian Cross model?

According to the Keynesian Cross model, what happens when there is an increase in spending plans?

What is the primary focus of the IS-LM model?

What does the Keynesian Cross model propose about an economy's total income?

What is the significance of a horizontal SRAS curve in the IS-LM model?

According to John Maynard Keynes, what drives an increase in total output in the short run?

How does the IS-LM model address changes in monetary policy?

In the Keynesian Cross model, what does the consumption function specifically describe?

What is the purpose of the Permanent Income Hypothesis in the Keynesian Cross model?

What does the mirror image of the consumption function, known as the savings function, specifically describe?

In the context of the Keynesian Cross model, what does the Life-Cycle Model of Consumption assume about people's savings behavior?

What is the implied impact of mandatory social security, as per the Life-Cycle Model of Consumption in the Keynesian Cross model?

Description

Review and summary of previous lessons on The Keynesian Cross, IS Curve, and LM Curve. Focuses on developing the IS-LM model, which forms the basis of the aggregate demand curve, and examines the short run with a fixed price level.

Make Your Own Quiz

Transform your notes into a shareable quiz, with AI.

Get started for free
Use Quizgecko on...
Browser
Browser