marginal propensity

marginal propensity

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1. An increase in the marginal propensity to save increases the value of the Keynesian multiplier.
2. An increase in the interest rate reduces the present value of an investment project by more the further in the future are the revenues from the investment.
3. An increase in national income, with a constant money supply, will reduce the price of bonds.
4. In the long run there is no trade-off between inflation and unemployment.
5. If the unemployment rate is higher than the Non-Accelerating Inflation Rate of Unemployment (NAIRU) the price level must be falling.

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