Given:
C= 220 + 0.8Yd
I= 200
G= 150
T=100
Find: Equilibrium GDP
Disposable Income
The multiplier
Given: C= 220 + 0.8Yd I= 200 G= 150 T=100 Find: Equilibrium GDP Disposable Income The...
Given: C = 500 + 0.8Yd where Yd = Y – T G = 200 T = 180 I = 100 Calculate the equilibrium level of national income.
Question#1AThe following are details of the expenditure of a very small economy. All the autonomous expenditures are given in $ thousand. C = 200 + 0.8Yd I = 10 G = 50 T = 0.05Y X = 40 M = 0.1Y Derive the aggregate expenditure function, and calculate the equilibrium real GDP Determine the expenditure multiplier using aggregate expenditure function slop value
Suppose that the consumption function is C = 14 + 0.8Yd, the investment is fixed at 12, and the government spending is equal to 10. Yd denotes the aggregate disposable income. The tax imposed is also equal to 10 and fixed. (1) Solve the equilibrium GDP. (2) How large is the fiscal multiplier, ∆Y/∆G? (3) Explain economically why the fiscal multiplier is greater than 1. Suppose next that taxes are imposed proportionally to the aggregate income, Y , with a...
2. Assume the following Keynesian model: C = 400 + .75Yd I = 200 G = 100 X = 150 M = 50 + .15 Yd T = 100 a. Find the aggregate expenditure function b. Find the equilibrium level of GDP. c. Using a “Keynesian cross” (or 45-degree line) diagram, show graphically the equilibrium in part a). d. What is the spending multiplier in this model? Tax multiplier? e. Show that leakages are equal to injections at equilibrium. f....
You are given the following income-expenditures model for the economy of Vulcan. C = 200 + .8Yd T = 50 G = 100 I = 140 a) What is the equilibrium level of income in Vulcan? b) At the equilibrium level of income, what is the amount of savings? c) If government spending increases to 150, what is the new level of equilibrium income?
Table C Disposable Income (Y) Consumption (C) $0 $40 100 100 200 160 300 220 400 280 4. Use Table C: WHAT IS THE CONSUMPTION FUNCTION? C =
M.4
1. Suppose the United States economy is represented by the following equations: Z=C+I+G YD=Y-T I = 30 C = 100 + 5YD G= 100 T = 200 a) Which variables are endogenous and which are exogenous? b) Calculate equilibrium levels of output, consumption and disposable income c) What is the multiplier for this economy d) What is the effect of increasing G by $100 on Y and the deficit
1. Suppose you are given the following information about Japan's economy: C = 150 + 0.8(Y-T) T = 0 Iplanned = 300 NX = 50 G = 200 a) Set up the aggregate planned expenditure function for Japan. (Write down the equation). b) Graph the aggregate expenditure function, using the diagram below. Be sure to label you graph. Carefully indicate the intercept. What is the slope of the line? c) Calculate equilibrium Real GDP (Y). d) Indicate the equilibrium on...
y C G I C+G+I C+G+I(2) 0 250 100 150 500 550 500 650 100 150 900 950 1000 1050 100 150 1300 1350 1500 1450 100 150 1700 1750 2000 1850 100 150 2100 2150 2500 2250 100 150 2500 2550 3000 2650 100 150 2900 2950 3500 3050 100 150 3300 3350 4000 3450 100 150 3700 3750 4500 3850 100 150 4100 4150 1. The consumption function is C=250+0.8y. How much are a (the intercept) and MPC...
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C S $ AD $100 $ 160 GDP $100 200 300 400 500 600 700 I $80 80 80 80 220 280 340 80 400 80 460 80 Complete the columns on S, and AD. (7 marks) The MPC is and the MPS is (4 marks) At $600 billion level of GDP, the APC is and APS is (4 marks) 4. If both government spending and taxes are zero, the equilibrium level...