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Ch 16 - All formulas
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Terms in this set (12)
Keynesian APC = (2)
C/Y or Cbar + c*Y
**Intertemporal Budget Constraint formula:
C1+(C2/1+r) = Y1 + (Y2/1+r)
**Present value of consumption formula:
C1+(C2/1+r)
**Present value of income formula:
Y1 + (Y2/1+r)
First period consumption formula:
Y1 + Y2/(1+r)
Second period consumption:
(1+r)Y1 + Y2
Modigliani smoothing consumption formula is (RY = earnings), T = years
C = W+RY/T
Modigliani consumption function is
C = 1/T(W) + R/T(Y)
Modigliani APC =
a(W/Y) + b
***PIH Consumption function is
C = αYP/C/Y
PIH APC is
αYP/Y
Random Walk formula, what is Et+1/
Ct+1 = Ct + Et+1/unexpected changes
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