Consider the Keynesian consumption function: and goods market clearing is given by: . Then, autonomous spending is captured by:
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0 marksMacroeconomicsKeynesian cross and the multiplierKeynesian cross equilibriumModerateabout 1 min
JNU SIS 2021 Question 32: Keynesian cross and the multiplier
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Consider the Keynesian consumption function: C = c₀ + c₁(Y - T) and goods market clearing is given by: Y = C + I + G. Then, autonomous spending is captured by: (A) c₀ (B) I + G (C) c₀ + I + G (D) c₀ + I + G - c₁T
Also written as: Consider the Keynesian consumption function: C = c_0 + c_1(Y - T) and goods market clearing is given by: Y = C + I + G. Then, autonomous spending is captured by:
Keynesian cross and the multiplier has come up 167 times in 7 exams since 2006.
What this question tests
This question is on Keynesian cross equilibrium, part of Keynesian cross and the multiplier in Macroeconomics.
How income is determined when output adjusts to planned spending, and what happens to unplanned inventories.
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