In the classical model, what are the effects of an increase in government spending?

Q: According to Keynes the source of high unemployment is: a. Excessive aggregate demand b.…

A: "Since you have asked multiple questions, we will solve first question for you .. If you want any…

Q: In the “complete Keynesian model”, the investment functions was I = I0 - f(i). An analyst now…

A: When investment is the function of national income, such investment is called induced investment.

Q: What stimulates a rise of employment according to Keynes? An increase of supply A decline of minimum…

A: Answer: In Keynesian theory a rise in employment results due to a rise in effective demand.

Q: Which of the following statements best describes the multiplier effect in economics? A. The process…

A: Economic growth is an increase in the production of goods and services in an economy over time. It…

Q: What are inflationary and recessionary gaps in the economy? How do they impact the economy?

A: Deflation is defined as a drop in the overall price level of all products and services in a specific…

Q: "An economy is dynamically inefficient if its citizens are short - sighted and save too little.…

A: Dynamic inefficiency in an economy occurs when the ongoing degree of buy-in doesn't augment the…

Q: Suppose the economy has fallen into a severe recession.  From a macroeconomic theory point of view…

A: Answer: c (increase government spending on goods and services) Explanation: A recession is a…

Q: If income is $1000 and consumption expenditure is $1200 then find the average propensity to save

A: The provided information are: Income (Y) = $1000 Consumption (C) = $1200

Q: The value of marginal propensity to consume is 0.44 Calculate the value of Marginal propensity to…

A: # We know that the sum of both MPS and MPC is 1 MPS + MPC = 1

Q: You are given the following information about a closed economy with no government: Consumption = 115…

A: Meaning of Effective Demand Function: Effective demand refers to the aggregate demand in an…

Q: Calculate the value of Marginal propensity to save when it's given that MPC = 0.65

A:

Q: What is The Effect of a Government Budget Deficit on Investment?

A: A budget deficit creates when expenses are more than revenue and can indicate the financial health…

Q: Differentiate between Classical and Keynesian Economists approach to savings.

A: The money that is left by a consumer after subtraction of consumer spending from their disposable…

Q: what ia aggregate spending

A: When studying economics, there are various economic terms that an individual needs to know and…

Q: As a result of increase in investment by $125, national income increases by $500. Calculate marginal…

A: Given that  Change in investment = $125 CHange in national income =$500 We have to calculate…