gross domestic product is the most commonly used measure to assess the size of the economy.
Macroeconomıc Theory (ENG) — Ünite 2 Soru-Cevap
Macroeconomıc Theory (ENG) (IKT214U) soru-cevapları.
What is the most commonly used measure to assess the size of the economy?
What is included in nonresidential investment?
Nonresidential investment contains the purchases of new equipment, plants, and machines, tools, and buildings by businesses and the government.
what is the most commonly used measure to assess the size of the economy?
Gross Domestic Product is the most commonly used measure to assess the size of the economy.
What is net exports?
Net exports are the difference between export revenue and import spending.
What are the components of Turkish GDP composition?
The components of Turkish GDP composition are consumption, government consumption, gross investment, change in stocks, net exports, exports, less imports, and gross domestic product.
What is the Keynesian consumption function formula?
The Keynesian consumption function formula is C=c0 + cYD
What is the equation used to calculate the amount of money spent on consumption?
apc= C/YD. The average propensity to consume (apc) is the proportion of consumption to disposable income, which indicates how much money is spent on consumption.
Which formula is used to calculate the change in investment in response to a change in income?
e= marginal propensity to invest= change in Investment/change in YD, is the marginal propensity to invest, which shows the change in investment in response to a change in income.
What factors affect planned investment?
Factors affecting planned investment are as follow:
- The demand for goods and services, both actual and anticipated,
- Expected profits,
- Business taxes,
- Interest rate,
- Credit market conditions,
- Business confidence.
What are the main tools of fiscal policy?
Taxes (T) and government spending (G) are the main tools of fiscal policy.
What makes up the components of aggregate demand in the Keynesian macroeconomic model?
According to the Keynesian model of macroeconomics, aggregate demand is composed of consumption, investment, and government spending in a closed economy
What happens to inventories and output when aggregate demand < output?
When aggregate demand less output, inventories tend to increase and output falls.
What is the equation for autonomous expenditure multiplier?
The equation of autonomous expenditure multiplier is 1/1-c(1-t)
What is the value of autonomous expenditure multiplier?
The value of autonomous expenditure multiplier is greater than one.
What is definition of multiplier effect?
change in aggregate demand leads to a much larger final impact on the level of equilibrium national income.
What term best describes the concept of transactions function as economic stimulants, generating additional income as a result of their spending?
"Injections" is the best term to describe transactions that function as economic stimulants, generating additional income as a result of their spending.
What does T>G and T<G mean in macroeconomics context?
If T > G, there is a budget surplus and positive public savings. If T< G, there is a budget deficit and negative public savings.
What does Keynesian theory suggest in times of economic recessions?
During times of recession, a rise in saving could restrain the economic recovery. Therefore, the Keynesian theory suggests increasing spending in times of economic recessions rather than increasing saving.
Why is interest rate assumed to be exogenous?
Interest rate is assumed to be exogenous, as it is determined outside the goods market.
What factors determine the slope of the IS curve?
The following factors determine the slope of the IS curve:
- The larger the marginal propensity to consume (c), the flatter the IS curve,
- The larger the elasticity of investment demand with respect to interest rate (b), the flatter the IS,
- The lower the income tax rate (t), the flatter the IS.