Term
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Definition
| a macroeconomic model that explains the long-run behavior of the economy |
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Definition
| adjustment of prices until quantities supplied and demanded are equal |
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Definition
| how many workers firms will want to hire at various wage rates |
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Definition
| indicates how mnay ppl will want to work at different wages |
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Term
| Aggregate production function |
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Definition
| relationship showing how much total output can be produced with different quantities of labor, with quantities of all other resources held constant |
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Term
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Definition
| the idea that total spending will be sufficient to purchase the total output produced |
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Term
| Planned Investment Spending |
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Definition
business purchases of plant and equipment
Ip=I-change in inventories |
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Term
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Definition
| Total Tax Revenue-Transfers |
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Term
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Definition
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Term
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Definition
| Disposable-C (consumption) |
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Term
| Total Spending formula in the classical model |
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Definition
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Term
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Definition
| income earned, but not spent, by households during a given year |
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Term
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Definition
spending from sources other than households
(goverment purchases of goods and services & planned investment spending) |
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Term
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Definition
| the market in which households make their saving available to borrowers |
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Term
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Definition
the excess of government purchases over net taxes
G-T |
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Term
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Definition
the excess of net taxes over goverment purchases
T-G |
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Term
| Business demand for funds curve |
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Definition
| indicates the level of investment spending firms plan at various interest rates |
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Term
| Government demand for funds curve |
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Definition
| indicates the amount of government borrowing at various interest rates |
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Term
| total demand for funds curve |
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Definition
| indicates the total amount of borrowing at verious interest rates |
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Term
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Definition
| a change in government purchases or net taxes designed to change total output |
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Term
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Definition
| macroeconomic policy effects on total output that work through changes in total spending |
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Definition
| a decline in one sector's spending caused by an increase in some other sector's spending |
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Term
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Definition
| a dollar-for-dollar decline in one sector's spending caused by an increase in some other sector's spending |
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