Q1: Explain why classical economists focus on prices, whilst Keynesians focus on disposable income when it comes to key factors able to maintain expansionary phases.

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Q2: What is the connection between Yd, MPC, and the RDGP?

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Q3: Why is autonomous consumption unique to the consumption expenditure?

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Q4: How much would your savings change by, if at MPC of 81%, your disposable income increases from $340 to $485?

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Q5: If your MPC is 0.92 and your disposable income falls by $290, what will be your change in consumption or spending?

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Q6: Explain which gap exists in the graph below:

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Q7: Using the graph above, assume Yf = $14.2 Trillion and Y1 = $14.9 Trillion, then with an MPC of 93%, what would Keynes recommend the government does?

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Q8: What is M with an MPC of 97%?

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Q9: With a recessionary gap of $3 trillion and MPS of 9%, what would Keynesians recommend the government does to return the economy back to equilibrium?

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Q10: Why is deflation the product of bad recessions, while inflation is associated with economic growth?

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Q11: What is the change in Yd if in one year income = $66,700 with a CPI of 236.43, and then income rises by $3700 while CPI jumps to 241.71?

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Q12: Explain why Keynesians favor changes in income taxes over changes in autonomous taxes:

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Q13: Give a qualitative example of the M:

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Q14: Give a quantitative example of the M

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Q15: Explain why real interest rates tend to be positive in general, and why this makes them favor lenders:

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