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Suppose That,at a Given Level of Disposable Income,consumers Decide to Save

question 53

Essay

Suppose that,at a given level of disposable income,consumers decide to save more.Explain what effect this decision will have on equilibrium income.Also,explain what effect this decision will have on the level of saving once the economy has reached the new equilibrium.


Definitions:

Cross-Sequential Design

is a research method that combines both longitudinal and cross-sectional designs to study changes over time in different cohorts.

Cognitive Development

The development of thinking, problem solving, and memory.

Longitudinal Design

A research strategy that involves following the same group of individuals over an extended period to observe changes or developments.

Cross-Sectional Design

A research method used to examine a population at a single point in time, allowing for the comparison of different population groups at the same time.

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