Homework Answers
Due to presence of HOMEWORKLIB POLICY, I am answering five questions.
13. b
Explanation: Post-Keynesian Economics is a school of economic thought which builds upon John Maynard Keynes's argument that effective demand is the key determinant of economic performance.
14. a
Explanation: Inflation is the growth rate in price index.
16. b
Explanation: According to theory of business cycles, GDP and employment go hand in hand.
17. a
Explanation: According to empirics, consumer has autonomous consumption + marginal consumption dependent on income.
18. b
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Student Full Name 12. (Post) Keynesian theory of the firm: the unit direct costs (UDC) are...
2 Student Full Name: 12 (Post) Keynesian theory of the firm: the unit direct costs (UDC)...
2 Student Full Name: 12 (Post) Keynesian theory of the firm: the unit direct costs (UDC) are normally a) increasing b) constant c) decreasing with respect to the level of production because firms usually operate below the level of full capacity 13. In the (Post) Keynesian markup pricing (Price = (1 + markup ) UDC), prices are: b) market-based and demand-determined a) administered by firms and cost-determined 14. Inflation rate: Nominal Wages c) Cost of market basket in a given...
17. Keynesian consumption function: a) C = C + mpcy b) I = I c)t 18....
17. Keynesian consumption function: a) C = C + mpcy b) I = I c)t 18. Keynesian government spending multiplier a) AC b) AY = AG c) mpc 19. Keynesian fiscal policy in a closed economy: considering that AE =C+I+G + mpc(1 - ty! where t is the tax rate, the government could increase the aggregate expenditure a) increasing the tax rate b) reducing the tax rate 20. If the marginal propensity to consume (mpc) increase, the Keynesian multiplier effect...
Solve 1. 2. 3. 4. 5. 1 Keynesian Cross Assume that households' consumption function is given...
Solve 1. 2. 3. 4. 5.
1 Keynesian Cross Assume that households' consumption function is given by C(Y -T) 50+ 0.75(Y T), that firms' investment function is I(r) 150 10r, government spending is G 150, and the tax bill T 200. 1. What is the Marginal Propensity to Consume "MPC")? 2. What is the equilibrium level of real GDP in the goods market if the real interest rate is 5%? (Plug in r = 5 for 5%, rather than 0.05...
1. A movement to the right (upward) along the intermediate range of the Modern Keynesian aggregate...
1. A movement to the right (upward) along the intermediate range of the Modern Keynesian aggregate supply curve (AS) illustrates: a. demand-pull inflation b. cost-push inflation C, hyperinflation d. decreasing resource costs 2. The aggregate demand (AD) curve will shift to the right if a. the government decreases its spending b. there is a large decrease in oil prices and energy costs c. the price level decreases d. households increase their consumption spending In an economy with an MPC of...
1. According to Keynesian theory, the primary determinant of the level of consumption and saving in...
1. According to Keynesian theory, the primary determinant of the level of consumption and saving in the economy is the: a. level of investment. c. level of prices. b. level of income. d. interest rate. 2. If a family's MPC is. 7, it is: a. spending 70 percent of its income on consumer goods. b. necessarily dissaving. c. spending seventenths of any increment to its income d. operating at the breakeven point. The size of the MPC is assumed to...
please show solutions also. Thanks Question 4 In a simple Keynesian model, assume that the marginal...
please show solutions also. Thanks
Question 4 In a simple Keynesian model, assume that the marginal propensity to consume (MPC) is 0.5. a) Find the government purchases multiplier b) Find the tax multiplier c) If the government wants to increase equilibrium real GDP by $ 500 billion, how much should the government increase spending? d) For the same purpose, how much should the government decrease taxes? According to Ricardian equivalence, do you think the government estimate is correct (should the...
VULCEA 1. When does the Keynesian theory of consumption NOT hold? a. In cross-sections. b. In...
VULCEA 1. When does the Keynesian theory of consumption NOT hold? a. In cross-sections. b. In the long run. c. In cyclical observations Other things being equal, the Neoclassical model of investment predicts that net investment will increase when 2. the: a. marginal product of capital falls. b. price of new capital goods rises. c. real interest rate rises. d. depreciation rate falls. 3. Which of the following is the weighted sum of the prices of a basket of domestically...
5. In the Keynesian-cross analysis, assume that the analysis of taxes is changed so that taxes,...
5. In the Keynesian-cross analysis, assume that the analysis of taxes is changed so that taxes, T, are made a function of income, as in T=T + tY, where T and t are parameters of the tax code and t is positive but less than 1. As compared to a case where t is zero, the multiplier for government purchases in this case will: A) not change. B) be smaller. C) be bigger. D) be equal to 1. 6. Exhibit:...
just answers 19 An increase il SI00. Which of the foll the MPC is 0.5 and...
just answers
19 An increase il SI00. Which of the foll the MPC is 0.5 and the increase in invesu the MPC is 0.5 and the increase in investment wd the MPC is 0.75 and the increase in investment was 25 the MPC is 0.75 and the increase in investment was 20 Assuming the new equilibrium income level is $400 and the level of full employment income is S600, there would be a: deflationary gap of $50 deflationary gap of...
[8] In Keynesian economics the most important factor determining whether the level of economic activity is...
[8] In Keynesian economics the most important factor determining whether the level of economic activity is growing or shrinking is: A) the multiplier effect. B) government expenditure and tax policies. C) the behavior of nonincome-determined spending. D) the relationship between leakages from and injections into the spending stream. [9] Using the Keynesian approach, if leakages from the spending stream are less than injections, the current level of output is: A) less than the equilibrium level of output, and will increase....
2 Student Full Name: 12 (Post) Keynesian theory of the firm: the unit direct costs (UDC) are normally a) increasing b) constant c) decreasing with respect to the level of production because firms usually operate below the level of full capacity 13. In the (Post) Keynesian markup pricing (Price = (1 + markup ) UDC), prices are: b) market-based and demand-determined a) administered by firms and cost-determined 14. Inflation rate: Nominal Wages c) Cost of market basket in a given...
17. Keynesian consumption function: a) C = C + mpcy b) I = I c)t 18. Keynesian government spending multiplier a) AC b) AY = AG c) mpc 19. Keynesian fiscal policy in a closed economy: considering that AE =C+I+G + mpc(1 - ty! where t is the tax rate, the government could increase the aggregate expenditure a) increasing the tax rate b) reducing the tax rate 20. If the marginal propensity to consume (mpc) increase, the Keynesian multiplier effect...
Solve 1. 2. 3. 4. 5.
1 Keynesian Cross Assume that households' consumption function is given by C(Y -T) 50+ 0.75(Y T), that firms' investment function is I(r) 150 10r, government spending is G 150, and the tax bill T 200. 1. What is the Marginal Propensity to Consume "MPC")? 2. What is the equilibrium level of real GDP in the goods market if the real interest rate is 5%? (Plug in r = 5 for 5%, rather than 0.05...
1. A movement to the right (upward) along the intermediate range of the Modern Keynesian aggregate supply curve (AS) illustrates: a. demand-pull inflation b. cost-push inflation C, hyperinflation d. decreasing resource costs 2. The aggregate demand (AD) curve will shift to the right if a. the government decreases its spending b. there is a large decrease in oil prices and energy costs c. the price level decreases d. households increase their consumption spending In an economy with an MPC of...
1. According to Keynesian theory, the primary determinant of the level of consumption and saving in the economy is the: a. level of investment. c. level of prices. b. level of income. d. interest rate. 2. If a family's MPC is. 7, it is: a. spending 70 percent of its income on consumer goods. b. necessarily dissaving. c. spending seventenths of any increment to its income d. operating at the breakeven point. The size of the MPC is assumed to...
please show solutions also. Thanks
Question 4 In a simple Keynesian model, assume that the marginal propensity to consume (MPC) is 0.5. a) Find the government purchases multiplier b) Find the tax multiplier c) If the government wants to increase equilibrium real GDP by $ 500 billion, how much should the government increase spending? d) For the same purpose, how much should the government decrease taxes? According to Ricardian equivalence, do you think the government estimate is correct (should the...
VULCEA 1. When does the Keynesian theory of consumption NOT hold? a. In cross-sections. b. In the long run. c. In cyclical observations Other things being equal, the Neoclassical model of investment predicts that net investment will increase when 2. the: a. marginal product of capital falls. b. price of new capital goods rises. c. real interest rate rises. d. depreciation rate falls. 3. Which of the following is the weighted sum of the prices of a basket of domestically...
5. In the Keynesian-cross analysis, assume that the analysis of taxes is changed so that taxes, T, are made a function of income, as in T=T + tY, where T and t are parameters of the tax code and t is positive but less than 1. As compared to a case where t is zero, the multiplier for government purchases in this case will: A) not change. B) be smaller. C) be bigger. D) be equal to 1. 6. Exhibit:...
just answers
19 An increase il SI00. Which of the foll the MPC is 0.5 and the increase in invesu the MPC is 0.5 and the increase in investment wd the MPC is 0.75 and the increase in investment was 25 the MPC is 0.75 and the increase in investment was 20 Assuming the new equilibrium income level is $400 and the level of full employment income is S600, there would be a: deflationary gap of $50 deflationary gap of...
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