Within the IS – LM model, what would be the effect of an autonomous increase in saving that was matched by a drop in consumption—that is, a fall in a in the consumption function? C = a + b(Y – T)...


Within the IS – LM model, what would be the effect of an autonomous increase in saving that was matched by a drop in consumption—that is, a fall in a in the consumption function?


C = a + b(Y – T)


Which schedule would shift? How would income and the interest rate be affected?



May 18, 2022
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