Determination of Income and Employment
In NCERT Introductory Macroeconomics, Chapter 3, this topic explains how the equilibrium level of income and employment is determined. You build the ideas of aggregate demand and aggregate supply, the consumption function, the propensity to consume and save, and the distinction between planned and realised saving and investment. The lesson shows how output adjusts until planned spending equals production, what deficient and excess demand mean, and how the investment multiplier magnifies an initial change in spending. With prices assumed fixed in the short run, the chapter closes on involuntary
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