Textbook Notes (368,122)
Canada (161,660)
ECON 302 (16)
Tom Velk (16)
Chapter 23

Chapter 23 Mishkin Summary.docx

3 Pages
108 Views
Unlock Document

Department
Economics (Arts)
Course
ECON 302
Professor
Tom Velk
Semester
Fall

Description
Chapter 23 Mishkin Notes 09/22/2013 The ISLM  model explains how interest rates and total output produced in the economy (aggregate  output or, equivalently, aggregate income) are determined, given a fixed price level. The ISLM  model is valuable not only because it can be used in economic forecasting, but also  because it provides a deeper understanding of how government policy can affect aggregate economic  activity. Summary: 1. In the simple Keynesian framework in which the price level is fixed, output is determined by the  equilibrium condition in the goods market that aggregate output equals aggregate demand. Aggregate  demand equals the sum of consumer expenditure, planned investment spending, government  spending, and net exports. Consumer expenditure is described by the consumption function, which  indicates that consumer expenditure will rise as disposable income increases. Keynes’s analysis shows  that aggregate output is positively related to autonomous consumer expenditure, planned investment  spending, government spending, and net exports and negatively related to the level of taxes. A change  in a
More Less

Related notes for ECON 302

Log In


OR

Join OneClass

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

Sign up

Join to view


OR

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.


Submit