Anonymous
Anonymous asked in Social ScienceEconomics · 2 months ago

When Investment doesnt equal savings?

How come in full employment savings are equal t investment? How does inflationary or recessionary periods demolish S=I equality? 

1 Answer

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  • Oiy
    Lv 6
    2 months ago

    In the Keynesian model,there are two definitions. Y=c+s+I+ im and Y=c+I+g+x. Only in equilibrium, it is y=y. And so is I=S. It is coincide with the classical model which is referred to the loanable fund theory.

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