Year 1982 1983 1984 Coal tons 1 million 2 million 2 million Wheat bushels 1 million 1 2 million million Pc ton Pw bu 100 120 100 100 80 100 Nominal Amount is just the PC PW Weight of coal x Pc in the year before Pc in the base year Weight of wheat x Pw in the same year Pw in the base year 6 7 1 1 7 1 1 6 7 Pc in 1982 Pc in 1983 1 7 Pw in 1982 Pw in 1983 PRICE INDEX POWERPOINT Autonomous Spending is everything except GDP consumption Aggregate Expenditures C I G Xn Find AE Y C a MPC Y Autonomous Not effected by change in disposable income in the short run I autonomous G autonomous Xn autonomous AE a MPC Y I G Xn AE Y At equilibrium it is same thing as Y kA a MPC Y I G XN Y a I G Xn Y Y MPC Y 1 MPC Y a I G Xn 1 MPC Ak A all autonomous spending together MPC Y Induced spending is to the MPC Y Y 1000 MPC 8 8 1000 800 induced spending Equilibrium AE Y DI Disposable Income Y Taxes A r a r I r G X IM mpcTx Government Budget Tx G Y kA k 1 1 NPC Change in Y K change in A
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