Aggregate spending refers to the value of all finished goods and services in the economy, that is, all the expenses incurred on the consumer goods, planned and unplanned savings and investments, expenses made by the government and the difference between exports and imports…
Download file to see previous pages...
He believed that one persons spending would always be the other persons earnings, thereby supporting his or her earnings. This cycle would keep on repeating itself thereby supporting a normal functioning economy. An economy normally attains equilibrium when the joint expenditure equals the joint production, but Keynes believed that the economy does not stay in this state. He argued that the total spending and production tend to adjust themselves toward the equilibrium. When there is excess supply than expenditure and demand, the prices and output go down thereby reducing the gross domestic product of the economy, but when there is excess of expenditure than supply, demand goes up thereby making prices and output to go up. It is clear that the economy keeps on shifting between excess supply and demand which enables it to keep on moving towards the equilibrium.
Keynesian equilibrium is only a balance between total expenditure and production and not necessarily other aggregate markets. This makes full employment not to be fully achieved. The major components of spending in this case are consumption, net exports, government purchases and investment. A change in all or any of them would affect the aggregate demand.
Actual gross domestic product refers to the sum of all the activities of the economy while potential gross domestic product on the other hand refers to the sum of all possible maximum economic activities which can be achieved through maximum deployment of the factors of production, which include expertise, normal resources, labor and capital. This difference between the potential and real gross domestic product is important in the sense that monetary policy makers use it to decide whether the economy needs more or less monetary stimulus with regard to the gap amid them (Arnon et al, 2011).
Multipliers refer to the measure of the extent to which businesses and households are
...Download file to see next pagesRead More
Cite this document
(“N/a Essay Example | Topics and Well Written Essays - 500 words - 6”, n.d.)
Retrieved from https://studentshare.org/macro-microeconomics/1605311-na
(N/a Essay Example | Topics and Well Written Essays - 500 Words - 6)
“N/a Essay Example | Topics and Well Written Essays - 500 Words - 6”, n.d. https://studentshare.org/macro-microeconomics/1605311-na.
It is the beginning point whereby senior management determines what strategies will align the company goals with its vision and values. SWOTS, PEST are some of the tool employed. Strategic management on the other hand, entails specifying organization’s mission and vision, goals, objectives, values, roles and responsibilities of the organization.
mpetition and money involved in the success associated with sports, there is the strong temptation to indulge in the use of performance enhancing drugs to gain the required edge and be a part of fame and financial gain that success in sports brings.
The use of performance
I have always loved enjoying my time swimming and other sports. I believe these sports gear up one’s body for the life’s different nuances and circumstances. I opine that life is there for the taking – one just needs to bring about an earnest
Similarly who will decide in which category to place high speed photography?
There are tons of photographic genres defined so far. To name a few; fashion photography, flash photography, aerial photography, black and white photography, stock photography,
would be on Sean O’Keefe, the administrator charged with ensuring that the National Aeronautics and Space Administration, NASA returns to Moon and further go to Mars during his 2001 to 2005 tenure (Lambright, 2008). NASA is an American government agency responsible for its
Electoral College is an organization responsible for the election of the President and Vice President in the United States of America. It means that plain citizens can’t take part in these elections, the President and Vice President are elected by the people who are
about nurses and the use of social media, I have come to realize that any posts on social media that I make concerning my patients regardless of just how innocent they might be or how private I might perceive them to be can actually result in my infringing of patient
This highlights the need for using the information technology in a manner that safeguards patient confidentiality. Given the ability of multiple accesses, the confidentiality of the patient falls at risk. Exposure of such