During a Recession, Consumers May Want to Save More to Provide

question 89

Essay

During a recession, consumers may want to save more to provide themselves with a reserve to cushion possible job losses. Use the Keynesian model to describe the impact of an exogenous decrease in consumption (a decrease in
C) on the equilibrium level of income in the economy. Will aggregate national saving increase?

---

Definitions:

Expert Advice

Recommendations or guidance provided by individuals with specialized knowledge or expertise in a particular field.

Training Program

Educational courses aimed at improving employee competencies and performance in their current or future roles.

Readiness For Training

The extent to which individuals have the necessary attitude, ability, and motivation to learn from training programs.

Social Support

Assistance and comfort provided by others, which can be emotional, informational, or practical in nature.