Ae Y Ae Aep C Ip C A By A Lp A 0 Yo Y1 Y 1 (43.8 KiB) Viewed 47 times
1. Assume that Net Exports, NX, is currently in a substantial
deficit. Will the intercept of the AEp function
rise, fall, or stay the same if the size of the trade deficit falls
but remains negative?
AE = Y AE AEp = C + Ip = C = a + bY a + lp a 0 YO Y1 Y
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