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NET EXPORTS LINE: The graphical depiction of the relation between net exports and national income (or gross domestic product) that plays a role in Keynesian economics and the Keynesian cross. The net exports line is derived by combining the exports line, relating exports and national income, with the imports line, relating imports and national income. Because exports are largely independent of national income and imports (which are subtracted from exports) increase with national income, the net exports line has a negative slope. The slope of the net exports line is thus the negative of the marginal propensity to import. The aggregate expenditures line used in the Keynesian cross is obtained by adding this net exports line, as well as, government purchases and net exports, to the consumption line. The government purchases line is also combined with investment expenditures for the Keynesian saving-investment model.

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AGGREGATE DEMAND DECREASE, LONG-RUN AGGREGATE MARKET

A shock to the long-run aggregate market caused by a decrease in aggregate demand resulting in and illustrated by a leftward shift of the aggregate demand curve. A decrease in aggregate demand in the long-run aggregate market results in an increase in the price level but no change in real production. The level of real production resulting from the aggregate demand shock is full-employment real production.

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Today, you are likely to spend a great deal of time watching infomercials looking to buy either a wall poster commemorating the 2000 Presidential election or a rechargeable flashlight. Be on the lookout for spoiled cheese hiding under your bed hatching conspiracies against humanity.
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Lewis Carroll, the author of Alice in Wonderland, was the pseudonym of Charles Dodgson, an accomplished mathematician and economist.
"Be willing to have it so. Acceptance of what has happened is the first step to overcoming the consequences of any misfortune."

-- William James, Psychologist

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