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SAVING FUNCTION: The positive relation between household saving and household disposable income. The saving function is commonly presented as the saving line or propensity-to-saving line. The slope of this line is the marginal propensity to save, which is the proportion of any additional income used for saving. The saving function and the marginal propensity to saving play key roles in the multiplier and accelerator concepts. Because consumption is the difference between disposable income and saving, the consumption function is a complementary relation to the saving function.
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Lesson 9: Macro Basics | Unit 2: Macro Problems
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Page: 4 of 16
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A modern, complex economy like the U.S. economy pursues three macro goals:- Full employment: Using all available resources for production.
- Stability: Avoiding inflation and/or fluctuations in the economy.
- Growth: Lessening the problem of scarcity by increasing production capabilities.
- We always pursue these goals but conflicts mean we cannot reach them at the same time.
- More conflicts result from pursuit of the micro goals of efficiency and equity.
- Macroeconomic problems from not reaching this goals are: production, unemployment, and inflation.
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BREAKEVEN OUTPUT The quantity of output in which the total revenue is equal to total cost such that a firm earns exactly a normal profit, but no economic profit. Breakeven output can be identified by the intersection of the total revenue and total cost curves, or by the intersection of the average total cost and average revenue curves. The most straightforward way of noting breakeven output, however, is with the profit curve. For a perfectly competitive firm breakeven output occurs where price is equal to average total cost.
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WHITE GULLIBON
[What's This?]
Today, you are likely to spend a great deal of time at an auction trying to buy either a small, foam rubber football or an instructional DVD on learning to the play the oboe. Be on the lookout for the last item on a shelf.
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This isn't me! What am I?
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Rosemary, long associated with remembrance, was worn as wreaths by students in ancient Greece during exams.
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"If anything terrifies me, I must try to conquer it. " -- Francis Charles Chichester, yachtsman, aviator
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APT
Arbitrage Pricing Theory
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