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Suppose that the marginal propensity to consume is dC dy = 0.8 -e-0.27 (in billions of...
Suppose that the marginal propensity to consume is dC dy = 0.7 − e−2y (in billions of dollars) and that consumption is $5.7 billion when disposable income is $0. Find the national consumption function.
Suppose that the marginal propensity to save is ds In(y + 1) = 0.93 (in billions of dollars) dy y + 1 and that consumption is $6.04 billion when disposable income is $0. Find the national consumption function. c(y)
Consumption expenditure (billions of 2009 dollars) 350- The graph shows the consumption function. What is the marginal propensity to consume, and what is autonomous consumption? 300 CF The marginal propensity to consume is 250- >>> Answer to 2 decimal places. 200- Autonomous consumption is $billion. 150 100 50- 0- 0 100 200 300 400 Disposable income (billions of 2009 dollars)
5. Graphing the consumption function from the MPC Consider a hypothetical economy in which the marginal propensity to consume (MPC) is 0.50. That is, if disposable income increases by $1, consumption increases by 50¢. Suppose further that last year disposable income in the economy was $400 billion and consumption was $350 billion. On the following graph, use the blue line (circle symbol) to plot this economy's consumption function based on these data. Consumption Function CONSUMPTION (Billions of dollars) 0 800...
Marginal propensity to consume is 0.8, and there is no trade, taxes or transfers in this economy. An increase of $1 billion in investment spending will cause O an increase of 0.8 billion dollars spending in the first round 5 billion dollars' worth of spending due to multiplier effects 4 billion dollars' worth of spending due to multiplier effects a $4 billion rightward shift in the AD curve
Suppose that the marginal propensity to consume in a country is 0.8, and the real potential output and current real GDP are respectively $800 billion and $700. To bring the economy to potential output, the government should increase its expenditure by $100 billion. True False
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...
Suppose the marginal propensity to consume is 0.8. The government increases government spending and taxes by $10 billion. What happens to aggregate output demanded?
Real GDP, consumption, and the marginal propensity to consume (MPC) for five hypothetical countries are shown in the table below. a. Enter the current level of saving in the appropriate column in the table. b. Now suppose that GDP increases by $20 billion in each of the five countries. What would be the new level level of saving in each country? Show your answers in the table below. Country Real GDP (Billions) Consumption (Billions) MPC Current Level of Saving (Billions)...
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...