Lecture title - Consumption drives PAE

6 important questions on Lecture title - Consumption drives PAE

What happens to household income when more output is produced?

More output produced leads to more income for households.

What is the relationship between output and consumption?

Increased output leads to increased consumption.

How does PAE relate to output?

PAE depends on Y (output).
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What happens to PAE with higher output?

Higher output leads to higher PAE.

What occurs with lower output?

Lower output results in lower income and less consumption.

What effect does less consumption have on PAE?

Less consumption leads to lower PAE.

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