Suppose you have the following information about a fictitious economy. Assume there are no taxes in...
Suppose you have the following information about a fictitious economy. Assume there are no taxes in this economy.
Disposable Income and Consumption
| Disposable Income (dollars) | Consumption (dollars) |
| $0 | $9,000 |
| 8,500 | 15,500 |
| 18,500 | 22,000 |
| 28,500 | 28,500 |
| 38,500 | 35,000 |
| 48,500 | 41,500 |
Instructions: In parts a and c, enter your answers as a whole number. In part b, round your answers to two decimal places.
a. What is the equilibrium level of consumption?
$_________
b. What is the MPC and MPS for this economy?
MPC: _________
MPS: _________
c. What is the value of autonomous consumption for this economy?
$ _________
Homework Answers
A) $ 28,500
B) MPC = ( 15,500 - 9,000) / 8,500 = 0.76
MPS = 1 - 0.76 = 0.24
C) $ 9,000
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Suppose you have the following information about a fictitious
economy. Assume there are no taxes in...
Suppose you have the following information about a fictitious economy. Assume there are no taxes in...
Suppose you have the following information about a fictitious economy. Assume there are no taxes in this economy. Disposable Income and Consumption Disposable Income Consumption dollars) (dollars) $e $7,000 10,500 14,000 21,880 21,000 31,589 28,000 42,880 1 35,000 52,500 42,000 Instructions: In parts a and c, enter your answers as a whole number. In part b, round your answers to two decimal places. a. What is the equilibrium level of consumption? S b. What is the MPC and MPS for...
The table below depicts the consumption schedule for an economy. Assume there are no taxes in...
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The table below shows the after-tax income and consumption spending for a nation. a. Calculate the...
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. YOU ARE GIVEN THE FOLLOWING INFORMATION ABOUT THE ECONOMY OF ENGLAND. PLEASE ANSWER QUESTIONS A...
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Assume that, without taxes, the consumption schedule of an economy is as follows: a. What is...
Assume that, without taxes, the consumption schedule of an
economy is as follows:
a. What is the value of the MPC?
_______
.Graph the resulting consumption
schedule.
Instructions: Use the tool provided 'CE' to draw
the consumption schedule. Plot 8 points total.
b. Assume now that a lump-sum tax is imposed such that the
government collects $10 billion in taxes at all levels of GDP. Add
the after-tax consumption to the table below.
Compare the MPC and the
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Consider the following information about a closed economy: GDP is $2,050 million, taxes are $250 million,...
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Suppose you have the following information about a fictitious economy. Assume there are no taxes in this economy. Disposable Income and Consumption Disposable Income Consumption dollars) (dollars) $e $7,000 10,500 14,000 21,880 21,000 31,589 28,000 42,880 1 35,000 52,500 42,000 Instructions: In parts a and c, enter your answers as a whole number. In part b, round your answers to two decimal places. a. What is the equilibrium level of consumption? S b. What is the MPC and MPS for...
The table below depicts the consumption schedule for an economy. Assume there are no taxes in this economy Disposable Income and Consumption Disposable Inc Consumption (dollars) (dollars) $0 $25,000 10,000 20,000 30,000 40.000 40,000 45,000 50,000 60.000 References Instructions: Use the tool provided 'C' to plot the consumption line point by point points total). Use the tool Equilibrium' to graph where consumption equals disposable income, plot the equilibrium line point by point use each disposable income entry in the table...
The table below shows the after-tax income and consumption spending for a nation. a. Calculate the dollar amount of savings, the marginal propensity to consurfe (MPC), and the marginal propensity to save (MPS) for each level of income. Instructions: Enter your answers for savings as a whole number. Round your answers for MPC and MPS to two decimal places. After-Tax Income and Consumption Spending Consumption Spending (dollars) $9,540 After-Tax Income (dollars) $18,700 Savings (dollars) MPC MPS $ 23,640 13,860 19,180...
. YOU ARE GIVEN THE FOLLOWING INFORMATION ABOUT THE ECONOMY OF ENGLAND. PLEASE ANSWER QUESTIONS A THROUGH C AND SHOW ALL WORK AND CALCULATIONS BELOVW DISPOSABLE INCOME CONSUMPTION (BILLIONS OF DOLLARS PER YEAR) $200 $100 S20 S30 $40 S360 $440 S520 A CALCULATE THE MARGINAL PROPENSITY TO CONSUME(MPC) AT EACH LEVEL OF DISPOSABLE INCOME AND CONSUMPTION LEVEL. INTERPET WHAT THE MPC NUMBER YO CALCULATED MEANS TO YO B. CALCULATE SAVINGS AT EACH LEVEL OF DISPOSABLE INCOME AND CONSUMPTION LEVEL. c....
ADVANCED ANALYSIS Suppose that the linear equation for consumption in a hypothetical economy is: C= 60 + 0.7Y Also suppose that income (Y) is $600. Determine the following values: Instructions: For parts a, b, d, and f, round your answers to 2 decimal places. For parts cand e, enter your answers as whole numbers. a. MPC = b. MPS = c. Consumption d. APC = e. Saving = 1. APS =
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Assume that, without taxes, the consumption schedule of an
economy is as follows:
a. What is the value of the MPC?
_______
.Graph the resulting consumption
schedule.
Instructions: Use the tool provided 'CE' to draw
the consumption schedule. Plot 8 points total.
b. Assume now that a lump-sum tax is imposed such that the
government collects $10 billion in taxes at all levels of GDP. Add
the after-tax consumption to the table below.
Compare the MPC and the
multiplier with...
In a simple economy (assume there are no taxes, thus Y is disposable income) the consumption function is C = 400 +0.75Y 2800- In this economy, the level of income at which the consumer breaks even (consumption equals income) is 24004 20004 1.) Using the point drawing tool, identify the breakeven income/consumption point that you found above 2) Using the line drawing tool, carefully graph the consumption function Properly label your line. Carefully follow the instructions above, and only draw...
Assume that, without taxes, the consumption schedule of an economy is as follows GDP, Billions Consumption, Billions $0 100 200 300 $40 120 200 280 360 440 520 600 400 500 600 700 a. What is the value of the MPC? Graph the resulting consumption schedule. Instructions: Use the tool provided "CE to draw the consumption schedule (plot 8 points total). Consumption Expenditure Tools CE Consumption (billions of dollars) 45 100 200 300 400 500 600 700 800 Help Save...
Consider the following information about a closed economy: GDP is $2,050 million, taxes are $250 million, consumption is $1,550 million, and government spending is $350 million. Calculate the following variables for this economy: Instructions: Enter numbers rounded to the nearest whole number. a. National savings: m illion dollars O O b. Investment: m illion dollars C. Private savings: million dollars
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