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If there is no equilibrium: adjustments to inventory. Question: If AE changes, what will happen to Y*? 1. Changes to Autonomous Expenditure (AI!) 0 Changes
If there is no equilibrium: adjustments to inventory. Question: If AE changes, what will happen to Y*? 1. Changes to Autonomous Expenditure (AI!) 0 Changes to autonomous consumption (CF) 0 Changes to autonomous investment (IF) 2. Changes to Induced Expenditure - Changes to marginal propensity to spend (mpc)
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