According to the keynesian consumption function, an increase in disposable income will result "an increase in consumption".
<h3>What is
keynesian consumption function/consumption function?</h3>
The consumption function, often known as the Keynesian consumption function, is now a mathematical expression expressing the functional connection between total expenditure and gross domestic product.
Some characteristics of keynesian consumption function are-
- John Maynard Keynes, a British economist, introduced it and said it could be used to monitor and foresee total aggregate consumption spending.
- According to the traditional consumption function, changes in income and consumer spending are entirely correlated. If this were the case, aggregate savings ought to rise proportionately as the GDP does over time.
- The goal is to establish a mathematical link between consumer spending and disposable income, but only at the aggregate level.
- One of the pillars for Keynesian macroeconomic theory is the consistency of either the consumption function, which is based in part upon Keynes' Psychological Law to Consuming and is particularly striking when compared to the volatility of investment.
- The majority of post-Keynesians acknowledge that because spending patterns vary as income increases, so consumption function is just not long-term stable.
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Being helpful, honest, polite, etc. are examples of instrumental values.
<h3>What are instrumental values?</h3>
Instrumental values are values or positive features that help people achieve goals, which is the reason why they are categorized as instrumental.
<h3>What are some examples of instrumental values?</h3>
Although there are many instrumental values, some of the most important include:
- Politeness, which helps you in many areas such as communicating better with people
- Honesty, which can help you in specific conflicts.
- Courage, which helps you continue despite fears or challenges.
- Independence, which helps you believe in yourself when achieving a goal.
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Answer:
The firm must increase price and decreasing the output
Explanation:
The reason is that with increased level of activity (Production level) the marginal cost increases and if the firm is going to increase it product price then less people will buy its product. This means the company will have to produce less in quantity which means that the company will substantially reduce its marginal cost and increase its marginal revenue.
OK so basically it is the representation of two different goods that can be obtained.