Chapter 10 class - Stock of capital goods on hand 7 The...

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Chapter 10 1. PI-T=DI a. PI i. Personal Income ii. 2. PI-C=S a. C= Consumption b. S=Savings 3. Other important considerations a. Changes along schedules b. Switch to real GDP c. Schedule shifts d. Stability e. Taxation 4. GDP = C+Ig+G+Xn a. Mr = Rate of Return b. Mc= Rate of interest i. Profit 1. MR=MC 2. MC>MR 5. Invest Rate and Investment a. Expected rate of return ( r) b. The Real Interest rate (i) 6. Investment Demand Curve a. Shifts of the curve i. Acquisition, maintenance, nad operateing costs
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b. Business taxes c. Technological change d.
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Unformatted text preview: Stock of capital goods on hand 7. The Multipliet Effects a. More spending results in higher GDP b. Initial change in spending changes GDP by a multiple amount i. Multiplier = Change in Real GDP/Initial Change in spending c. Causes the initial change in spending i. Changes in investment ii. Other changes 1. Shift of investment demand curve up or down d. Rationale i. Dollars spent are revived as income ii. Income received s spent (MPO)...
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This note was uploaded on 05/09/2011 for the course ECON 102 taught by Professor Ashookshulka during the Spring '11 term at Harrisburg Area Community College.

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Chapter 10 class - Stock of capital goods on hand 7 The...

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