IDENTITY
AD et it g
cotayy terr tiotiyytirrtg
MARKETCLEARING
y AD
moneuinac
Heterogeneity differingconsumption although
goodisn'tanecessaryrequirement
in ourcase wetakea samplehouse
modelaggconsCe
Éche
PlH PERMANENTincomeHYPOTHESIS
Peopleoptimallyconsumebyallocatingresourcesovertheirlifetime
Max
Éftp.logcet st
If i Ceti
lifetimeutility Yee
t t
citrine i
Éf Yeti
resources
Eiffel
smallmpc
ce x yee notsensitiveto Ar
RESULTS
consumptionsmoothing
yet directlydeterminesCe
tempAy smallAc permAy 1 1 Ac
, HANDTOMOUTH
debt
saverepay
in
aborrow
P.intassumes nocreditconstraints
É
ce get i
Flye
ein
9 of Mee
MULTIPLIER
AyfromAz exogfactors
usuallyby
surprise
y cotcyll
tlytit ys.ci
lcotitgl
Htm nighmpc Pl H lowmpc
bigmultiplier smallmultiplier
nigha lows
, INVESTMENT
spendingongoodsthatyielda streamofutilitythroughfutureservices
Firmscaneitherinvestorpayoutdividends
Ielts al
theory
Max
Éc pestde tie satchel
Iv I tech
Pgift
DEP wet hell s tie
I t
mis me
Elt 11 81af h t 1
g i tr fi try
q
Sh It fork
M3 MC
MBcmc Eggiight tocatchup
, LEVERAGE at
empirical
firm'sstockmarketvalue
Q replacementcostof k
a 1 stockmarketsovervalued
Q weaknegative noeffectof on I I dependentoncashflow
can'tmeasurespecifier
animalspiritsmeanthatinvestorsusuallyactspontaneously
I mayonlybeweaklydependenton r
lessdependentondebt
iscurve
r
is
y
as rt er and in willy
scope shifts
r sensitivity 2 exogenousfactor
policyeffectiveness
C I multiplier