Homework Answers
C = 40 + 0.8Y
Ig = 60 - 2i
i = 10
Ig = 60 - (2 * 10) = 60 - 20 = 40
In a private closed economy, at equilibrium,
Y = C + Ig
Y = 40 + 0.8Y + 40
Y = 80 + 0.8Y
Y - 0.8Y = 80
0.2Y = 80
Y = 80/0.2
Y = 400
Thus,
The equilibrium level of GDP in this economy is $400.
QUESTION 3 C=40+0.8Y 1, -15 40 x = x= 20 M:M 30 Advanced analysis) The equations...
QUESTION 3 C=40+0.8Y 1, -15 40 x = x= 20 M:M 30 Advanced analysis) The equations give information for a private open economy. The letters Y, CX and tand for GDP, consumption, gross investment, exports, and imports,respectively. Figures are in billions of dollars. This nation is experiencing O unemployment. balance in its international trade O a trade surplus O a trade deficit.
ADVANCED ANALYSIS Assume that the consumption schedule for a private open economy is such that consumption...
ADVANCED ANALYSIS Assume that the consumption schedule for a private open economy is such that consumption is:C = 100+ 0.8Y Assume further that planned investment lo and net exports Xn are independent of the level of real GDP and constant at lg = 60 and Xn = 10. Government spending (G) is equal to $0. Recall also that, in equilibrium, the real output produced (y) is equal to aggregate expenditures: Y=C+Ig+G+Xn nstructions: Round your answers to the nearest whole number. a. What is the...
The following equations describe the domestic economy: C 20+0.8Y I 0, G 0 X 0.03Y, and...
The following equations describe the domestic economy: C 20+0.8Y I 0, G 0 X 0.03Y, and Q 0.3Y And the following equations describe the foreign economy: C" =2000.8Y I0, G =0, -75+0.25Y, and Q0.1Y X= Suppose the real exchange rates in both economies are fixed and equal to one. Find equilibrium Y and Y* b) Suppose that the domestic economy experiences a 10% drop in its autonomous consumption, a) i.e. the consumption function changes to C = 18+0.8Y Find the...
Stefan Scrobanovich Gross Domestic Product $100 200 Consumption $120 180 240 300 360 500 Expected Rate...
Stefan Scrobanovich Gross Domestic Product $100 200 Consumption $120 180 240 300 360 500 Expected Rate of Return Amount of Investment 25% 20 Refer to the tables of information for a private closed economy. If the real interest rate is 10 percent, the equilibrium GDP will be Select one: a. $400 b. $300 c. $100 d. $200 Am A WTC
E. The following equations describe the domestic economy: C = 20+ 0.8Y I = 0, G =0, X = 0.03Y* and Q=0.3Y And the follo...
E. The following equations describe the domestic economy: C = 20+ 0.8Y I = 0, G =0, X = 0.03Y* and Q=0.3Y And the following equations describe the foreign economy: C* = 200+ 0.8Y I* = 0, G* = 0, X* = 75 +0.25Y, and Q* = 0.1Y* Suppose the real exchange rates in both economies are fixed and equal to one. 1. Find equilibrium Y and Y*. 2. Suppose that the domestic economy experiences a 10% drop in its...
Assuming the level of investment is $16 billion and independent of the level of total output,...
Assuming the level of investment is $16 billion and independent of the level of total output, complete the following table and determine the equilibrium levels of output and employment in this private closed economy. What are the sizes of the MPC and MPS? Be sure to answer both parts of the question—fill in the data and compute the MPC and MPS. Possible levels of employment (millions) Real domestic output (GDP=DI) (billions) Consumption (billions) Saving (billions) 40 45 50 55 60...
Suppose an economy is characterized by the following equations C-260+0.6 Yd Yd-Y-T I-250 G-250 T =...
Suppose an economy is characterized by the following equations C-260+0.6 Yd Yd-Y-T I-250 G-250 T = 200 Is this econ Determine the following: omy closed or open? Explain 1) The equilibrium level of GDP (Y) 2) The total disposable income (%) of the household 3) Total consumption expenditure 4) Private savings of household, government savings and the national savings of the economy 5) Is private savings the same as aggregate investment? Explain
So I know the equation for GDP is consumers+investement+Goverment spending +(X-M). but could someone break down...
So I know the equation for GDP is
consumers+investement+Goverment spending +(X-M). but could someone
break down what qualfies as cosumer,investment,goverment spending?
and then solve ?
Answer the question on the basis of the following national income data for the economy. All figures are in billions of dollars. Personal Consumption Expenditures $400 Government Purchases 128 Gross Private Domestic Investment 88 Net Exports Net Foreign Factor Income Consumption of Fixed Capital Taxes on Production and Imports Compensation of Employees 369 Rents Interest...
2. Refer to the diagram. Under which tax system, the cyclical deficit would be the highest?...
2. Refer to the diagram. Under which tax system, the cyclical deficit would be the highest? Lowest? (4 points) Tax Revenue GDP 3. Assume in a closed economy that, at the equilibrium level of income the MPS is 0.20. Suppose government collects taxes of $70 and spends the entire amount. As a result, the equilibrium level of income becomes $420. What was the before-tax equilibrium level of income? (10 points) 4. Consider the following consumption schedule for a closed economy....
Calculate the equilibrium level of national income when G=50 I = 15 C = 0.997 +60...
Calculate the equilibrium level of national income when G=50 I = 15 C = 0.997 +60 T=0.8Y+ 15 (government expenditure) (investment) (consumption) (taxation) The equilibrium level of national income is Y = (Round to the nearest integer as needed.)
QUESTION 3 C=40+0.8Y 1, -15 40 x = x= 20 M:M 30 Advanced analysis) The equations give information for a private open economy. The letters Y, CX and tand for GDP, consumption, gross investment, exports, and imports,respectively. Figures are in billions of dollars. This nation is experiencing O unemployment. balance in its international trade O a trade surplus O a trade deficit.
ADVANCED ANALYSIS Assume that the consumption schedule for a private open economy is such that consumption is:C = 100+ 0.8Y Assume further that planned investment lo and net exports Xn are independent of the level of real GDP and constant at lg = 60 and Xn = 10. Government spending (G) is equal to $0. Recall also that, in equilibrium, the real output produced (y) is equal to aggregate expenditures: Y=C+Ig+G+Xn nstructions: Round your answers to the nearest whole number. a. What is the...
The following equations describe the domestic economy: C 20+0.8Y I 0, G 0 X 0.03Y, and Q 0.3Y And the following equations describe the foreign economy: C" =2000.8Y I0, G =0, -75+0.25Y, and Q0.1Y X= Suppose the real exchange rates in both economies are fixed and equal to one. Find equilibrium Y and Y* b) Suppose that the domestic economy experiences a 10% drop in its autonomous consumption, a) i.e. the consumption function changes to C = 18+0.8Y Find the...
Stefan Scrobanovich Gross Domestic Product $100 200 Consumption $120 180 240 300 360 500 Expected Rate of Return Amount of Investment 25% 20 Refer to the tables of information for a private closed economy. If the real interest rate is 10 percent, the equilibrium GDP will be Select one: a. $400 b. $300 c. $100 d. $200 Am A WTC
E. The following equations describe the domestic economy: C = 20+ 0.8Y I = 0, G =0, X = 0.03Y* and Q=0.3Y And the following equations describe the foreign economy: C* = 200+ 0.8Y I* = 0, G* = 0, X* = 75 +0.25Y, and Q* = 0.1Y* Suppose the real exchange rates in both economies are fixed and equal to one. 1. Find equilibrium Y and Y*. 2. Suppose that the domestic economy experiences a 10% drop in its...
Suppose an economy is characterized by the following equations C-260+0.6 Yd Yd-Y-T I-250 G-250 T = 200 Is this econ Determine the following: omy closed or open? Explain 1) The equilibrium level of GDP (Y) 2) The total disposable income (%) of the household 3) Total consumption expenditure 4) Private savings of household, government savings and the national savings of the economy 5) Is private savings the same as aggregate investment? Explain
So I know the equation for GDP is
consumers+investement+Goverment spending +(X-M). but could someone
break down what qualfies as cosumer,investment,goverment spending?
and then solve ?
Answer the question on the basis of the following national income data for the economy. All figures are in billions of dollars. Personal Consumption Expenditures $400 Government Purchases 128 Gross Private Domestic Investment 88 Net Exports Net Foreign Factor Income Consumption of Fixed Capital Taxes on Production and Imports Compensation of Employees 369 Rents Interest...
2. Refer to the diagram. Under which tax system, the cyclical deficit would be the highest? Lowest? (4 points) Tax Revenue GDP 3. Assume in a closed economy that, at the equilibrium level of income the MPS is 0.20. Suppose government collects taxes of $70 and spends the entire amount. As a result, the equilibrium level of income becomes $420. What was the before-tax equilibrium level of income? (10 points) 4. Consider the following consumption schedule for a closed economy....
Calculate the equilibrium level of national income when G=50 I = 15 C = 0.997 +60 T=0.8Y+ 15 (government expenditure) (investment) (consumption) (taxation) The equilibrium level of national income is Y = (Round to the nearest integer as needed.)
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