Class Notes (975,478)
US (383,435)
FAMU (7)
ABE 1010 (1)
rgr (1)
Lecture 1

ABE 1010 Lecture 1: 5J7K2aK9n3

1 Page
Fall 2011

ABE - Biological & Agricultural Systems Engineering
Course Code
ABE 1010

This preview shows half of the first page. Sign up to view the full page of the document.
● Say’sLaw:“supplycreatesitsowndemand”
● Exogenousvariables:land,entrepreneurship,capital,technology,G,T,tasksforworking
● Endogenous:W/P,Labor(L),Output(Y),R(interestrate),Savings,Investment(Ip)
○ Also:C=YST
● Changeinoneofmoreexogenousvariables→changeinendogenousvariables
● Fiscalpolicy:achangeingovernmentspending(G)ortaxes(T)designedtochange
○ Demandsideeffects
■ Changeintotalspending
○ Supplysideeffects
■ Changeintotalresourcesavailable
■ Changeintechnology
● Forsimplicity:assumeinitiallyG=T
○ GT=0
○ Gisnotdemandingloanablefunds
● IfGisgreaterthanT,thereisadeficit
○ Consumptiondecreases,Investmentdecreases
○ AmountofdecreaseinC+amountofdecreaseinIp=increaseinG
● Crowdingout:whenanincreaseinonesector’sspendingcausesadecreaseinanother
● Completecrowdingout:whenanincreaseinonesector’sspending=decreasein
● Conclusion:inclassicalmodel,fiscalpolicyhasnodemandsideeffect
● InitiallyIpcurveshiftstotherightbecauseofdecreaseinT,causingincreaseinC
● ThenpeopledecidetosavemoreoftheamounttheyhavegainedfromTcut
○ SoConsumptiondecreasesandSavingsincreases
○ AmountofincreaseinC=AmountofdecreaseinIp
○ Totalspendingisunchanged
● Conclusion:inclassicalmodel,fiscalpolicyhasnodemandsideeffect

Loved by over 2.2 million students

Over 90% improved by at least one letter grade.

Leah — University of Toronto

OneClass has been such a huge help in my studies at UofT especially since I am a transfer student. OneClass is the study buddy I never had before and definitely gives me the extra push to get from a B to an A!

Leah — University of Toronto
Saarim — University of Michigan

Balancing social life With academics can be difficult, that is why I'm so glad that OneClass is out there where I can find the top notes for all of my classes. Now I can be the all-star student I want to be.

Saarim — University of Michigan
Jenna — University of Wisconsin

As a college student living on a college budget, I love how easy it is to earn gift cards just by submitting my notes.

Jenna — University of Wisconsin
Anne — University of California

OneClass has allowed me to catch up with my most difficult course! #lifesaver

Anne — University of California
ECON UA 1 Lecture 11 Classical Model Classical Model: Says Law: supply creates its own demand Exogenous variables: land, entrepreneurship, capital, technology, G, T, tasks for working Endogenous: WP, Labor (L), Output (Y), R (interest rate), Savings, Investment (Ip) Also: C = YST Comparative Statics Change in one of more exogenous variables change in endogenous variables Fiscal policy: a change in government spending (G) or taxes (T) designed to change output (Y) and employment (L) Demand side effects Change in total spending Supply side effects Change in total resources available Change in technology Experiment 1: increase in G For simplicity: assume initially G = T GT = 0 G is not demanding loanable funds If G is greater than T, there is
More Less
Unlock Document

Only half of the first page are available for preview. Some parts have been intentionally blurred.

Unlock Document
You're Reading a Preview

Unlock to view full version

Unlock Document

You've reached the limit of 4 previews this month

Create an account for unlimited previews.

Already have an account?

Log In


Don't have an account?

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.