During the third quarter of 1997, Japanese GDP was falling at an annual rate of over...

Question

Question

During the third quarter of 1997, Japanese GDP was falling at an annual rate of over 11 percent. Many blame the big increase

business economics

Add a comment Improve this question Transcribed image text

Answer 1

Answer #1

(c) If taxes increase then disposable income declines, consumption falls, planned aggregate expenditure falls, and aggregate income (output) declines.As a result of tax increase, aggregate demand decreases thus both the consumption and expenditure falls.

Add a comment

Answer 2

Similar Homework Help Questions

During the third quarter of 1997, Japanese GDP was falling at an annual rate of over...

During the third quarter of 1997, Japanese GDP was falling at an annual rate of over 11 percent. Many blamed the big increase in Japan's taxes in the spring of 1997, which was designed to balance the budget. How could an increase in taxes with the economy growing slowly precipitate a recession? When taxes increase, disposable income will_ As disposable income , it causes consumption to which_ output/income. O A. fall; decreases; increase; raises O B. fall; decreases; decline; reduces...
1. If the government reduces spending A) the IS curve will shift to the right B)...

1. If the government reduces spending A) the IS curve will shift to the right B) output will increase if interest rates remain fixed C) consumption will increase D) all of the above 2. If the government cuts taxes A) disposable income falls B) planned expenditures rise C) the IS curve shifts to the left D) all of the above 3. Qualitatively, an increase in government purchases has the same impact as an increase in autonomous A) consumption B) investment...
Aggo Gross Domestic Product for the First Quarter of 2017 The increase in real GDP in...

Aggo Gross Domestic Product for the First Quarter of 2017 The increase in real GDP in the first quarter of 2017 primarily reflected increases in personal consumption expenditure (+1.1 % ), exports (-0.1 % ) , and investment (+29 % ). Imports of goods and services increased by 3.3 % Source Statistics Canada, May 31, 2017 M #6- Explain how the tems in the news clp influence Canada's aggregate demand The increase in the personal consumption expenditures aggregate demand. The...

1.) If the marginal propensity to consume is 0.75 and investment spending increases by $200 billion,...

1.) If the marginal propensity to consume is 0.75 and investment spending increases by $200 billion, equilibrium GDP will increase by____. $350 billion $150 billion $200 billion $266.7 billion $800 billion 2.) AE = 3000 + 0.75*RGDP. Given this equation for AE, find equilibrium GDP $1,000 $750 $12,000 $2,250 3.) The four components of aggregate planned expenditure are the real interest rate, disposable income, wealth, and expected future income the real interest rate, consumption expenditure, investment, and government expenditures consumption...
Product 13) 13) The gap that exists when equilibrium real Gross Domestic (GDP) is greater than...

Product 13) 13) The gap that exists when equilibrium real Gross Domestic (GDP) is greater than full employment real Gross Domestic Product (GDP) is called a(n) A) demand gap. C) recessionary gap B) employment gap D) inflationary gap 14) 14) Economic growth will NOT result in inflation if aggregate demand shifts A) outward to the right at the same speed as aggregate supply B) outward to the right as aggregate supply shifts inward to the left. C) inward to the...
1. In a closed economy to have sustainable output, Aggregate Expenditures are equal to

1. In a closed economy to have sustainable output, Aggregate Expenditures are equal toa. Consumptionb. Consumption + Investmentc. Consumption + Investment + Govemmentd. Consumption + Investment + Net Exports2. The calculation 1 /(1-MPC) equalsa. Marginal Propensity to Saveb. Multiplierc. Aggregate Expenditured. Average Consumption3. In a closed economy, when Aggregate Expenditures equal GDP.a. Consumption equals investmentb. Consumption equals aggregate expenditurec. Saving = Planned Investmentd. Disposable income equals consumption minus saving4. Net exports are calculated asa. Importsb. Imports - Exportsc. Exports -...

10.) An economy has a marginal propensity to consume and Y* , income-expenditure equilibrium GDP,...

10.) An economy has a marginal propensity to consume and Y* , income-expenditure equilibrium GDP, equals $500 billion. Given an autonomous increase in plannėd investment of $10 billion, show the rounds of increased spending that take place by completing the accompanying table. The first and second rows are filled in for you. In the first row the increase of planned investment spending of $10 billion raises real GDP and YD by $10 billion, leading to an increase in consumer spending...
QUESTION 7 1 pc Assume C 50+.80yd (disposable income); Taxes GDP (V)? (Hint: Yd = Y...

QUESTION 7 1 pc Assume C 50+.80yd (disposable income); Taxes GDP (V)? (Hint: Yd = Y - Taxes) 10; Investment - 30: Goverment - 20: Exports 16; and Imports - 20. What is the O a 200 26.400 c. 405 d. 435 QUESTION 8 From the question above, C (consumption) is equal to 360 390 O 414 OO QUESTION 9 Use the following table to find the MPC and MPS: SA NI Answ QUESTION 9 Ube the following table to...
1. Complete the table below where the cells are blank. (10 pts) Output Sensor Saving Inxstant...

1. Complete the table below where the cells are blank. (10 pts) Output Sensor Saving Inxstant Export Import ort GDP=DI Net Agg Age Unnind Output Invent Emploxmnt 250 260 310 15 330310 2. What number is unplanned inventories at output of $270 million? Explain what the unplanned inventories number means at that output level? (2 pts) 3. At $330 million of output what must happen in this open economy to reach equilibrium? (2 pts) 4. Equilibrium is achieved at what...

Expert economists in the economy of Bongo estimate the following: Billion Bongos Real output/income 1 comma...

Expert economists in the economy of Bongo estimate the following: Billion Bongos Real output/income 1 comma 2001,200 Government purchases 200200 Total net taxes 200200 Investment spending (planned) 100100 Assume that Bongoliers consume 8080 percent of their disposable incomes and save 2020 percent. You are asked by the business editor of the Bongo Tribune to predict the events of the next few months. By using the data given and assuming that investment is constant, if the government of Bongo makes no...

During the third quarter of 1997, Japanese GDP was falling at an annual rate of over...

Homework Answers