The burst of the housing bubble can be represented in the IS-MP model as a decline in $\bar { a }$ .

Name: The burst of the housing bubble can be represented in the IS-MP model as a decline in $\bar { a }$ .
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Question

The burst of the housing bubble can be represented in the IS-MP model as a decline in $\bar { a }$  .

Quizplus · Accepted Answer

The burst of the housing bubble leads to a decrease in autonomous consumption and investment, which is represented by a decline in $\bar { a }$ in the IS-MP model, indicating a leftward shift of the IS curve.

The Burst of the Housing Bubble Can Be Represented in the IS-MP