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Keynesian Tbeory ??

The document discusses Keynesian economic theory, particularly in relation to unemployment and the Great Depression of the 1930s. It highlights the importance of macroeconomic theory and the role of government spending in reducing unemployment. The text also touches on concepts such as consumption function, equilibrium, and the impact of injections and leakages in the economy.

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akttiwari1300
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29 views16 pages

Keynesian Tbeory ??

The document discusses Keynesian economic theory, particularly in relation to unemployment and the Great Depression of the 1930s. It highlights the importance of macroeconomic theory and the role of government spending in reducing unemployment. The text also touches on concepts such as consumption function, equilibrium, and the impact of injections and leakages in the economy.

Uploaded by

akttiwari1300
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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L-asy 4 bee 1 Se 40 ae G= re € Ain savings per unit 109 abs = Si A cTeta) Say. > { a \ Total income? oy OE ~~ a : _ . fncreenent np op XS Sau! 1S.an. 7 ; ‘ _ Poa, Dae oe eg @ | Consomp- 1S od i x t get ft . ede he ee 8 + _€x Alnte dj planned. een r z 3 . 5 2 =. : COjansed piaoning to sell_ Bansal e aa FA Ta ots aa ine $F ; Fac. bones Se ue > Equilibrium , RD=AS ‘ 4 eS S } Aelel hc. 1S ely a> _ - eS AS= Vet ine C marrel 0 oon anf) eta intervene ®LAN 5 2» 1) sthokalenays = AS iP iy @i Ao oil = consum- plan abuays Coincide ‘ith . a) Consumers ; % 4a, eds 0 er Producers plan to Invest matches eee @aus © eSiAh ‘households Bag fo Save re ——— ql. TF poifiee © a fini clicslar Aows re POE BE of g ID S modef retreats Flee eee rn —rhvestment i Gia sephet PY Cate mach- Pardnc 4 425 Prod- ip leakage injections i r CSasing > |nves-) gy eG bec: Frode: vy | Market ould not qutomatally lead to fill empioym- 4 ollib- ae | level of & + i ee T RL ed Economy Could settle in ie — i Sesources—are & eqoilib- gt on evel of Unemployment shderea 2, J (eg eee {all eoabis He 1 NO, Eco- enderempiade / i { eee ©) ae. ys alma ne os -_ Caatora 0°) ie —- @ Ao Inlewect As at fotenfal GOP = Full emp NO guarantee eq. occur ‘ ae ad potential- OP so _ q aad aia Deglationany Gap” for emp- eral a a ae aa Caen 0 : [e PS aby ceempegmere) ADo : a reduction Y ee , IFAD. < Feqeiec arpa ——eomiumert ¥ => Income V tmp leva 7 Y AT Safire Demand 5 patty — in " ie een omer req| output cvill be Constant, bot zise ia call! Cause in Nominal outpot 2 equip. The nce level | coll beat Ae ca ‘Pac3es tT —> Nominal_outpoi e ce ts at deca 43 t fea income & employment = Same i; f é — [aia ore ee E i arger_) in_equil- level _of income (49) ~ Honan aes ere oe aasy recut of ai: exe Az = Sos Ay= Fase ath 3 e Sam en 6 os wal = og Wee), Sense 2 Shows A joy for each Code A io) (nye i eae AO [Assume ® MPC = 0.9 Mmpsaros? Nan phe : Coes. AY Fhe AS é S pia de S900) Aep0g ee? Jooo ae - | Maes ooo 3200 Foo eee! | fod aii 8200 meheneS; Ha 7640 2 Tl es a = Ar=0S Sou | @ max vale =| SO = ae ee Hh bay @ minimam valve = a ae = House {bib go With fore r e Diceetty ership ones uo mea » |_blv_k @ mee bit Wek \ : Sh eeu Is PPS a ComexPe chat) pe i ~— © Tinatiipies shows how Pee Co ; = Sectos_aze—-transmitled 400 io F Multiples _¢ leakages ———— TT ——>Hncome: ot spent of fans: a Ki ; _— ~ OF goods ¢ Serviees—= Leakage 7 a ee i SRO Ce CC aia 0 Progrensive—Rale-of fanaa tt RT) Os Se _ holdi 4 _& |. Argh liquidity Feejerence ¢ low MeO ea ReT —~ a & * demand Eds) met out oF existing 4 A 8a “Shas of thrugh |mposts a _ acy @ Addition! Yncome Spent on purchasing Lae existing acahth or phurch- of shares | Secu- mec is High in under valve OF midltipies fs loc wn "> lack oF In frastruc ~ unskilled ook face Tar es es sae “In 3 Sector mode 0) aot SS fnb= 6 +3 elas be House he for exes ee ima SNe ing 2° C tS, 4 Taxes ard eng f f ne. bey, Go0d62 fete 6 J Consume iden | et Transfer fay - | = <> NN a CHovsehold~) ea Saving 4 out J es mata payment — ares por foviehale ¢ Bin: SOC ovsehold_¢ Subsidy to business | Govt “Purchase eg. fom .Ausiness & Fac of _fred- “from household s OV Onow m Kina- Rrairortte Finance deicit : Autonom: Inv __CAvtongmm me a ~ Auton- Govt €xbend: oy ee eae hee eas ett erst Tr | r+ H=.StT “ I Dinmvg bic = pee | t= eal i iS “What sill testore equil”- Coot 4 ig Pace) )— [ Govt: sectos F |acome Determination a ee a ee oN Govt Tifivences The level of income i “thovah{ Teves), Tense: Payment, Govt Purch. @ got —@ eS | Bor or = ji s f —- eee Be ends (LY) S pg | G ® M income ax - = Rutohemiogs ¢ Chagreisn® B ee g Fobe—_——___ tee} i - Rg= L=0.3 ‘ = 2000 —— é | Wei Ben yrtco= 64 | } . —Hacion Tax a's + IE CTast like atby) Fror 7 Gon So ike + ty), J4- ey B In case Transjer Peasenso Received Gr. t- ® = 1 3 } me Autonomous 3 AE (yt a? eo =a Pty <2 ---> Balanced Caleolate eq: Y= 2 e Budgey ok Coa = TR ooo ee at C+ T+G 5 GeT= 20 =~ ! Ky Y= Jost os 18 ‘Tyz20] + 50 +20 t Jy = lolto-1Sy— o- pistes) $ #10 vel_of income) 7 ~ ane eee Pr i a e Beye as Sot Fre = i o-2S¥ = 657 2 fen F655 1 BI QS ia Eo | foe Gas to sti yy e726 Bes l coe ase a to ee io e- inde BoE £100 (then ane eo Howseb. “tied | a ce oo Hr eo C= yx mpc R 2 vk CTex fc ay ¢ Jo ka, Be il 2 ep SO os Gama ag © jar oul mec (i=! ae ere 3 es He ——}=too-F 0-800 OFFS) F 200 F198 i | J= loo + o-azy Qo +300 LF Ke i | = 4204 9-427 S i 0-281= 32 _—s ON erst ss hla Pea tee i eon es. y sy ney 7 hs . fisnate + Injections in. Matt Incorte floreign..idemand. for domeshe output Topp Tet oor br expoat depends on 2 | 19 € xogenou $ L, Autonomws > Leakage oer oviflocs of nab-y. " wot demand for dom- Jods. dedoc- fom Ao pe Fropen- > [mipor = Slope Pas eee} ae y.,-bot_disp- 4°) : ae EqatisnomAD= AS Cy) 7 : _ ae C+Tt GH + Cx) =¥ M foreign ‘ facome @ I : ngections leakages i aioe ectien = tnjec-> lealcage ‘Natond Ree ef Oe ve) leakages > Injections ch Ni Hi TGP cet Shee oe lation af acorn [ THO EM, { i abe Git Trequllio « ieee co SETEM : Qtatx © " 2 )_froportiona) Fax is _ incloed. — oe -—he | great : : ‘ll be : . = The more open an eco- iS 40 Bieian “rade ‘*——the Smaller qill be the response of Y 10 i Rg gregate demamd Shocks- radi : ts Bangowt Spendiage iv a: domes- goods. 1 xpansionaay vw Conttactionaxy _eHect - re @__T in demand for exports = ADTS eqoen @) * ia Imports = AOL eq-y b “396 ts are bad | h => Countries impart goods a+ ei a - | epicientig ca Predoceq abroad @ rade“ incecse the ovetall e)ieienay Gj woild@side “qllocah'e! ¢ ae . eee peak) S fez 6o%0-A4d T= lo Azle a0. K=2 ae | eq. ye? Diels Ratosy inot jvtiade Balance =? rade... Myltipsas 2 = 6a t -d¥.t 19-4 fo420 | loto-051 9 t0-I7%+ lotlo + 2o7 Jo so-05 y ‘ | J1f5b erlang Qo= ot 0:06 x 600]. | Ao— [lot @& S x Cec] c Teo z | fea) ot 205 [ fo +30].7 R07 40 Gaze) aes ee FI TE NE TO I 2 Veit C,0ibageasp isu FS 6o [tallies aah Gul htad Bag a = maa Mel ic ee? Pa dente Seal es sc tt fittobab flim om pila

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