Fill in the blanks using the following words : higher, lower, steeper, flatter, smooth, increase, lower more, less. Compare two economies, which differ only in their share of credit-constrained households but are identical otherwise. The MPC will be in the economy with the greater proportion of credit-constrained households. Agents who do not have access to financial markets can not properly their consumption, and so their consumption choices are responsive to changes in income. This means that the AD curve is going to be in the country with the larger share of credit-constrained households.

Fill in the blanks using the following words : higher, lower, steeper, flatter, smooth, increase, lower more, less. Compare two economies, which differ only in their share of credit-constrained households but are identical otherwise. The MPC will be in the economy with the greater proportion of credit-constrained households. Agents who do not have access to financial markets can not properly their consumption, and so their consumption choices are responsive to changes in income. This means that the AD curve is going to be in the country with the larger share of credit-constrained households.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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