1) "Keynesian" problems

Formulas

Consumption = autonomous consumption plus the product of the additional amount of consumption per dollar of income and disposable income

• Consumption Function: C= a + MPC (Y)

Marginal Propensity to Consume:additional amount of consumption per dollar of income

• Change in consumption divided by change in disposable income

Marginal Propensity to Save = the additional amount of savings per dollar of income earned.

• 1-MPC
• Change in savings divided by change in disposable income

Spending Multiplier:

•