What factors will shift the aggregate expenditure function for a given level of real domestic income?
What will be an ideal response?
Any factors embedded in the autonomous spending components from the different sectors. Increases in personal taxes, real interest rate, consumer debt, business taxes, and the currency exchange rate will decrease aggregate autonomous expenditures whereas increases in consumer confidence, consumer wealth, expected profits, capacity utilization, government spending, and level of foreign real income will increase aggregate autonomous expenditures.
You might also like to view...
Refer to the table below. If the cost per unit of advertising is constant at $550, what is the level of advertising per week that maximizes the industry joint profit?
Suppose the dairy industry is made of up only by the three firms above; Cow Haven, Free Cows, and Happy Cows.
A) 4 B) 5 C) 3 D) 2
If marginal costs rises above average costs, average costs must
a. Be increasing b. Be decreasing c. Stay constant d. None of the above
The economic system that answers the What, How and For Whom questions the way they have always been answered is a:
a. market economy. b. command economy c. soviet economy. d. traditional economy.
Which of the following formulas would correctly calculate a monopolist's profit?
a. profit = price – marginal cost b. profit = price – average total cost c. profit = (price – marginal cost) × quantity d. profit = (price – average total cost) × quantity