According to the lectures, which of the following ideas are representative of (neo)classical (orthodox) theory, which are representative of (post)Keynesian (heterodox) theory, and which are shared by both theories? In equilibrium, aggregate demand (total planned spending) -- must equal output and income Demand, particularly intended investment, drives supply Supply creates its own demand Capitalist economies tend to full employment, at least in the long run Interest rates fall when money saved exceeds the demand for those funds for investment, until savings equals investment -- Saving is a leakage out of, and investment is an injection - into, the spending flow 1. (neo)classical Investment and savings are primarily functions of the rate -- of interest 2. (post)Keynesian 3. Both The paradox of thrift "In the long run, we're all dead" Capitalist economies will normally fail to reach full - employment due to insufficient aggregate demand -- Savings equals investment in equilibrium (ignoring - government or foreign sector) -- The loanable funds market Output, income, and employment fall when money saved exceeds intended investment, until savings equals investment

According to the lectures, which of the following ideas are representative of (neo)classical (orthodox) theory, which are representative of (post)Keynesian (heterodox) theory, and which are shared by both theories? In equilibrium, aggregate demand (total planned spending) -- must equal output and income Demand, particularly intended investment, drives supply Supply creates its own demand Capitalist economies tend to full employment, at least in the long run Interest rates fall when money saved exceeds the demand for those funds for investment, until savings equals investment -- Saving is a leakage out of, and investment is an injection - into, the spending flow 1. (neo)classical Investment and savings are primarily functions of the rate -- of interest 2. (post)Keynesian 3. Both The paradox of thrift "In the long run, we're all dead" Capitalist economies will normally fail to reach full - employment due to insufficient aggregate demand -- Savings equals investment in equilibrium (ignoring - government or foreign sector) -- The loanable funds market Output, income, and employment fall when money saved exceeds intended investment, until savings equals investment

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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