Formula variables

Hi,

Thank you for your message. Unfortunately, I’m not going to give a full list of definitions of parameters. Here’s why:

1. I don’t want students to learn these by rote. Maybe the exam will use different notation and use z_0 differently to how it was used in the lectures!
2. I want students to think about the building blocks of the model, and understand the role that the parameters play from understanding these building blocks. If a student doesn’t remember that c_1 is called the MPC, it’s not the end of the world. What matters is that, by inspecting C = c_0 + c_1 x Y^d that one realizes that c_1 gives the effect that an additional unit of disposable income has on consumption. And, more importantly, how a lower c_1, for example, changes the size of fiscal and money multipliers.
3. ***If you're unsure about anything, come visit me in my office hours***

Best
Oliver