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Given the following values for an economy, how much savings would occur at the equilibrium level...
6a. Assume a closed economy with no government, in which the aggregate consumption function is C...
6a. Assume a closed economy with no government, in which the aggregate consumption function is C = 100 + .75Y and investment (I) is $100 billion. In the income-expenditure analysis, the equilibrium level of national income is: a. $300 billion. b. $500 billion. c. $200 billion. d. $800 billion. e. $650 billion. 6b. The difference between a household’s disposable income and its consumption: a. equals any saving by the household. b. equals the taxes the household pays. c. equals the...
Consider the economy of Wiknam. The consumption function is given by f. With the initial values...
Consider the economy of Wiknam. The consumption function is given by f. With the initial values for monetary and fiscal policy, suppose that the price level falls from 5 to 3. What happens ? What are the new equilibrium interest rate and level of income? C = 250+ 0.6(Y-T). The investment function is The LM curve shifts to the by about 383.33. I = 100-20r. What are the new equilibrium interest rate and level of income? The money demand function...
Given the following data for an economy, the value of the marginal propensity to invest is...
Given the following data for an economy, the value of the marginal propensity to invest is equal to: Consumption = 50 + .75Y Investment = 20 + .10Y Government = 60 Taxes = .20Y Group of answer choices .20 .10 20 .75
The data of the open economy of Lowland is given below. All values are in Smillions. Use the information given below an...
The data of the open economy of Lowland is given below. All values are in Smillions. Use the information given below and your knowledge to answer the questions that follows. Consumption: C = 30+ 0.6 YD Disposable income: YD-Y-NT Government's net tax: NT - 4 +0.2Y Planned investment: I = 40 Government's expenditure: G-20 Export: X-50 Import: 10+ 0.05Y Using the information given above calculate the following: (a) Marginal propensity to save? (b) Equilibrium level of income. (c) Value for...
1). Given a marginal propensity to consume = .8 (Ceteris paribus) and the government increases the...
1). Given a marginal propensity to consume = .8 (Ceteris paribus) and the government increases the level of transfer payments by $100, we should expect that the GDP will increase by a. $500. b. $80. c. $100. d. $400. 2). Suppose that actual GDP (Y) for France is 100 euros and: Consumption = 10 + .5Y Investment Spending = 5 Government Expenditure = 20 The Marginal Tax Rate (t) = .20 At these current levels, the size of the budget...
h) Suppose taxes are cut to .18Y. What would happen to the equilibrium level of income...
h) Suppose taxes are cut to .18Y. What would happen to the equilibrium level of income in this economy (how much would it change)? 4) Suppose that there exists an economy, Macroland, which is characterized by the following behavioral equations C=-340+.9Y I= 2007.14 G = 2200 T= 2Y X = 1100 Q = 300+.1 Yd Ya=Y-T. Note that taxes and investment are based on total income (Y), not on disposable income (Y). a) Find an expenditure function relating expenditures (E)...
How much is the multiplier?. Here are some facts about the economy of Inferior. Marginal propensity...
How much is the multiplier?. Here are some facts about the economy of Inferior. Marginal propensity to consume 3/5 marginal propensity to import 0 autonomous consumption 4 exports 0 private investment 20 income tax rate 0 government expenditures 0 Income consumption investment government aggregate expenditures expenditures 0 10 20 30 40 50 60 70 80 90
Suppose a closed economy has an aggregate consumption function given by C = 100 +0.75Yd and...
Suppose a closed economy has an aggregate consumption function given by C = 100 +0.75Yd and generates $2500 output and income in equilibrium. Suppose also that the government spends 500 and imposes a lump-sum tax of 50. What is the level of intended investment? (round your answer to the nearest whole value) Your Answer: Suppose a closed economy has an aggregate savings equal to 100 and intended investment equal to 500. 10 By how much must the government be in...
Consider a small economy that is closed to trade, so its net exports are equal to zero. Suppose that the economy has the following consumption function
5. Algebra of the income-expenditure model Consider a small economy that is closed to trade, so its net exports are equal to zero. Suppose that the economy has the following consumption function, where C is consumption, Y is real GDP, I is investment, G is government purchases, and T is for net taxes: C= 20 + 0.75 x (Y - T) Suppose G = $35 billion, 1 = $60 billion, and T = $20 billion. Given the consumption function and the fact that, in...
FEEDBACK Content attribution QUESTION 16.1 POINT Suppose an economy has a private domestic savings of $245...
FEEDBACK Content attribution QUESTION 16.1 POINT Suppose an economy has a private domestic savings of $245 billion, a government surplus of $500 billion, and private domestic investment of $1,125 billion. How much is the trade deficit (in billions of dollars)? Recall the savings investment formula: S+(M -X) = 1 + (G-T) Provide your answer below: billion FEEDBAC Content attribution QUESTION 17 - 1 POINT A country's level of trade tells how much of its production it QUESTION 18 • 2...
Consider the economy of Wiknam. The consumption function is given by f. With the initial values for monetary and fiscal policy, suppose that the price level falls from 5 to 3. What happens ? What are the new equilibrium interest rate and level of income? C = 250+ 0.6(Y-T). The investment function is The LM curve shifts to the by about 383.33. I = 100-20r. What are the new equilibrium interest rate and level of income? The money demand function...
The data of the open economy of Lowland is given below. All values are in Smillions. Use the information given below and your knowledge to answer the questions that follows. Consumption: C = 30+ 0.6 YD Disposable income: YD-Y-NT Government's net tax: NT - 4 +0.2Y Planned investment: I = 40 Government's expenditure: G-20 Export: X-50 Import: 10+ 0.05Y Using the information given above calculate the following: (a) Marginal propensity to save? (b) Equilibrium level of income. (c) Value for...
h) Suppose taxes are cut to .18Y. What would happen to the equilibrium level of income in this economy (how much would it change)? 4) Suppose that there exists an economy, Macroland, which is characterized by the following behavioral equations C=-340+.9Y I= 2007.14 G = 2200 T= 2Y X = 1100 Q = 300+.1 Yd Ya=Y-T. Note that taxes and investment are based on total income (Y), not on disposable income (Y). a) Find an expenditure function relating expenditures (E)...
Suppose a closed economy has an aggregate consumption function given by C = 100 +0.75Yd and generates $2500 output and income in equilibrium. Suppose also that the government spends 500 and imposes a lump-sum tax of 50. What is the level of intended investment? (round your answer to the nearest whole value) Your Answer: Suppose a closed economy has an aggregate savings equal to 100 and intended investment equal to 500. 10 By how much must the government be in...
FEEDBACK Content attribution QUESTION 16.1 POINT Suppose an economy has a private domestic savings of $245 billion, a government surplus of $500 billion, and private domestic investment of $1,125 billion. How much is the trade deficit (in billions of dollars)? Recall the savings investment formula: S+(M -X) = 1 + (G-T) Provide your answer below: billion FEEDBAC Content attribution QUESTION 17 - 1 POINT A country's level of trade tells how much of its production it QUESTION 18 • 2...
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