In the Keynesian linear consumption function Y=?1+?2X, the parameters of the model are
A)?1and ?2
B). ?1and x
C)x and y d. y an
D)?2

Question

Quizplus · Accepted Answer

The parameters of the Keynesian linear consumption function, which is typically represented as C = a + bY (where C is consumption, Y is income, a is the autonomous consumption, and b is the marginal propensity to consume), are analogous to ?1 and ?2 in the given function Y = ?1 + ?2X. These parameters represent the intercept (?1) and the slope (?2) of the function, respectively.

In the Keynesian Linear Consumption Function Y=?1+?2X, the Parameters of the Model