ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Abstract. Government expenditure is realized to be the exogenous variable and its change impacts national income through Aggregate Demand expression. The purpose of this study is to derive new macroeconomic expression based on Keynesian basis with SAM multiplier through mathematical approach.

Detailed explanation-2: -While the money supply and the budget deficit are modeled as endogenous, government expenditure is assumed to be exogenously determined by the policymaker.

Detailed explanation-3: -Exogenous variable example External factors like crop-eating pests and the weather would be exogenous variables. This is because other variables in the model can ‘t affect these variables. They can cause more or fewer crops to grow, but the crops can’t affect them in return.

Detailed explanation-4: -Consumption would be an endogenous variable-a variable you are trying to explain. One possible exogenous variable is the income tax rate. The income tax rate is set by the government, and if you are not interested in explaining government behavior, you would take the tax rate as exogenous.

Detailed explanation-5: -In an economic model, an exogenous variable is one whose measure is determined outside the model and is imposed on the model, and an exogenous change is a change in an exogenous variable. In contrast, an endogenous variable is a variable whose measure is determined by the model.