Solved

If We Write the Consumption Function As Ct/Yˉt=aˉc+xˉY~tC _ { t } / \bar { Y } _ { t } = \bar { a } _ { c } + \bar { x } \tilde { Y } _ { t }

Question 61

Multiple Choice

If we write the consumption function as Ct/Yˉt=aˉc+xˉY~tC _ { t } / \bar { Y } _ { t } = \bar { a } _ { c } + \bar { x } \tilde { Y } _ { t } , if xˉ<1\bar { x } < 1
, the IS curve is given by:


A) Y~t=11xˉ×[aˉbˉ(Rtrˉ) ]\tilde { Y } _ { t } = \frac { 1 } { 1 - \bar { x } } \times \left[ \bar { a } - \bar { b } \left( R _ { t } - \bar { r } \right) \right]
B) Y~t=(1xˉ) ×[aˉbˉ(Rtrˉ) ]\tilde { Y } _ { t } = ( 1 - \bar { x } ) \times \left[ \bar { a } - \bar { b } \left( R _ { t } - \bar { r } \right) \right]
C) Y~t=aˉbˉ(Rtrˉ) \tilde { Y } _ { t } = \bar { a } - \bar { b } \left( R _ { t } - \bar { r } \right)
D) Y~z=xˉ×[aˉbˉ(Rtrˉ) ]\tilde { Y } _ { z } = \bar { x } \times \left[ \bar { a } - \bar { b } \left( R _ { t } - \bar { r } \right) \right]
E) Y~t=1xˉ×[aˉbˉ(Rtrˉ) ]\tilde { Y } _ { t } = \frac { 1 } { \bar { x } } \times \left[ \bar { a } - \bar { b } \left( R _ { t } - \bar { r } \right) \right]

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions