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Unit 5: The aggregate expenditures model(closed economy) - Coggle Diagram
Unit 5: The aggregate expenditures model(closed economy)
Equilibrium GDP: C+lg=GDP
Table analysis
Equilibrium GDP
Disequilibrium
Aggregate expenditures
Real domestic output
Graph analysis
Equilibrium GDP
aggregate expenditure schedule
Consumption and Investment schedule
Investment schedule
real interest rate
Investment schedule
Various levels of GDP
assumption and simplification
Prices are fixed
Use the Keynesian aggregate expenditure model
GDP=DI
Begin with private, closed economy
other features of equilibrium GDP
savings= planned investment
savings
leakage of spending
Investment
injection of spending
No unplanned changes in inventories
production does not change