With reference to the Keynesian theory, if real GDP were $500 and government expenditure increased by $80, what would be the new real GDP?
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Homework Answers
Government expenditure is a component of the real GDP. The new real GDP = old real GDP + increase in government expenditure = $500 + $80 = $580.
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With reference to the Keynesian theory, if real GDP were $500
and government expenditure increased by...
With reference to the Keynesian theory and cross graph, if the real GDP were initially $900,...
With reference to the Keynesian theory and cross graph, if the real GDP were initially $900, what would tend to happen to consumption expenditure? How would it change and why would it change? Why would it stop changing? Expenditure (E) Possible equilibrium points E=Y 1000 900 800 C+I+G+NX 700 600 500 400 300 200 100 0 100 200 300 400 500 600 700 800 900 1000 GDP (Y)
Question 1 (500 words please) With reference to the following diagram (numbers are in billions): (a)...
Question 1 (500 words please) With reference to the following diagram (numbers are in billions): (a) If real GDP were initially $200, what would tend to happen to consumption expenditure and why? (b) If real GDP were initially $900, what would tend to happen to consumption expenditure and why? (c) According to Keynesian theory, if real GDP were $500 and government expenditure increased by $80, what would be the new real GDP? Expenditure (E) 1000 900 Possible equilibrium points E=Y...
1. Aggregate expenditure and income The following table shows consumption (C), investment (I), government purchases (G),...
1. Aggregate expenditure and income The following table shows consumption (C), investment (I), government purchases (G), and net exports (X−IM) in a hypothetical economy for various levels of real GDP (Y). Assume that the price level remains unchanged at all levels of income. All figures are in billions of dollars. Compute total expenditure for each income level, and fill in the last column in the following table. Y C I G X−IM Total Expenditure 500 300 150 200 -100 600...
endrid-side Equiorum: Unemployment or Inflation? 1. Aggregate expenditure and income The following table shows consumption (C),...
endrid-side Equiorum: Unemployment or Inflation? 1. Aggregate expenditure and income The following table shows consumption (C), investment (1), government purchases (G), and net exports (X-IM) in a hypothetical economy for various levels of real GDP (Y). Assume that the price level remains unchanged at all levels of income. All figures are in billions of dollars. 550 Compute total expenditure for each income level, and fill in the last column in the following table. Y c 1 G X -IM Total...
Assume the government cuts taxes by $200 billion. If the MPC is 0.8, what is the maximum potential impact on real GDP according to the simple Keynesian model?
Assume the government cuts taxes by $200 billion. If the MPC is 0.8, what is the maximum potential impact on real GDP according to the simple Keynesian model? Real GDP increases by $1,000 billion Real GDP Increases by $800 billion Real GDP decreases by 51.000 billion Real GDP decreases by 5000 buttonIn Keynesian theory, if the marginal propensity to consume is 0.90 and government spending is increased by $50 billion, then real income (GDP) will maximum of billion by a decrease: $500 decrease $50 Increase: $500 Increase: $50
Potential GDP 1,000 AE AE. 800 700 600 ΔΑΕ Aggregate Expenditure (dollars) 400 200 AY 45°...
Potential GDP 1,000 AE AE. 800 700 600 ΔΑΕ Aggregate Expenditure (dollars) 400 200 AY 45° 0 0 200 400 600 700 800 1,000 Real GDP (billions of constant dollars) 11. Given the following Consumption Function as C = 350 +0.75 (Y); and actual equilibrium real GDP as $700; and full-employment real GDP as $800. The amount of government spending necessary to close up such GDP gap is: $20 $32.50 $30 $25 $27.50
ASSIGNMENT # 3 Actual aggregate expenditure or output (Y) (billions of $) Consumption (C) (billions of...
ASSIGNMENT # 3 Actual aggregate expenditure or output (Y) (billions of $) Consumption (C) (billions of $) Planned investment (billions of $) Government spending (G) (billions of $) Net exports (NX) (billions of $) Unplanned investment (inventory change) (billions of $) 500 300 150 100 50 600 350 700 400 800 450 900 500 For the table shown, answer the following questions: For each level of actual aggregate expenditure, calculate unplanned inventory investment. What is the equilibrium level of aggregate...
Potential GDP 1,000 AE, AE 800 700 600 - AAE Aggregate Expenditure (dollars) 400 200 AY...
Potential GDP 1,000 AE, AE 800 700 600 - AAE Aggregate Expenditure (dollars) 400 200 AY 45° 0 0 200 400 600 700 800 1,000 Real GDP (billions of constant dollars) 16. Given the following Consumption Function as C = 350 +0.75 (Y); and actual equilibrium real GDP as $700; and full-employment real GDP as $800. The amount of taxes that need to be cut to close up such GDP gap is: $33.33 -$35.33 -$30.33 cannot be computed based on...
Hi, I need some help with these. Thanks! C S $ AD $100 $ 160 GDP...
Hi, I need some help with
these. Thanks!
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...
Question #1 (10 Marks) 500 1000 1500 2000 2500 3000 3500 200 650 1100 1550 2000...
Question #1 (10 Marks) 500 1000 1500 2000 2500 3000 3500 200 650 1100 1550 2000 2450 2900 3350 100 100 100 100 100 100 100 1005001600 250 500 500 500 500 500 500 500 1400 50 200 1000 400 125 600 S0 8001O 1000 2000 1200 8SD 400 400 400 Complete the Total Planned Expenditure (AE) column for all levels of income (Y) on the above table. a) What is the consumption function? Complete the equation. C- 200 b)...
Question 1 (500 words please) With reference to the following diagram (numbers are in billions): (a) If real GDP were initially $200, what would tend to happen to consumption expenditure and why? (b) If real GDP were initially $900, what would tend to happen to consumption expenditure and why? (c) According to Keynesian theory, if real GDP were $500 and government expenditure increased by $80, what would be the new real GDP? Expenditure (E) 1000 900 Possible equilibrium points E=Y...
endrid-side Equiorum: Unemployment or Inflation? 1. Aggregate expenditure and income The following table shows consumption (C), investment (1), government purchases (G), and net exports (X-IM) in a hypothetical economy for various levels of real GDP (Y). Assume that the price level remains unchanged at all levels of income. All figures are in billions of dollars. 550 Compute total expenditure for each income level, and fill in the last column in the following table. Y c 1 G X -IM Total...
Potential GDP 1,000 AE AE. 800 700 600 ΔΑΕ Aggregate Expenditure (dollars) 400 200 AY 45° 0 0 200 400 600 700 800 1,000 Real GDP (billions of constant dollars) 11. Given the following Consumption Function as C = 350 +0.75 (Y); and actual equilibrium real GDP as $700; and full-employment real GDP as $800. The amount of government spending necessary to close up such GDP gap is: $20 $32.50 $30 $25 $27.50
Potential GDP 1,000 AE, AE 800 700 600 - AAE Aggregate Expenditure (dollars) 400 200 AY 45° 0 0 200 400 600 700 800 1,000 Real GDP (billions of constant dollars) 16. Given the following Consumption Function as C = 350 +0.75 (Y); and actual equilibrium real GDP as $700; and full-employment real GDP as $800. The amount of taxes that need to be cut to close up such GDP gap is: $33.33 -$35.33 -$30.33 cannot be computed based on...
Hi, I need some help with
these. Thanks!
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...
Question #1 (10 Marks) 500 1000 1500 2000 2500 3000 3500 200 650 1100 1550 2000 2450 2900 3350 100 100 100 100 100 100 100 1005001600 250 500 500 500 500 500 500 500 1400 50 200 1000 400 125 600 S0 8001O 1000 2000 1200 8SD 400 400 400 Complete the Total Planned Expenditure (AE) column for all levels of income (Y) on the above table. a) What is the consumption function? Complete the equation. C- 200 b)...
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