suppose the actual GDP is $15 trillion & the potential real GDP is $18 trillion. If...
suppose the actual GDP is $15 trillion & the potential real GDP is $18 trillion. If the MPS is .03
What kind of GDP is this economy experiencing?
what kind fiscal policy & monetary policy would u recommend to eliminate the gap (include a graph to illustrate the relationship)
By how much the government should change taxes to
eliminate the gap?
Homework Answers
Add Answer to:
suppose the actual GDP is $15 trillion & the
potential real GDP is $18 trillion. If...
suppose the actual GDP is $15 trillion & the potential real GDP is $18 trillion. If the MPS is .03 What kind of GDP is this economy experiencing? what kind fiscal policy & monetary policy woul...
suppose the actual GDP is $15 trillion & the potential real GDP is $18 trillion. If the MPS is .03 What kind of GDP is this economy experiencing? what kind fiscal policy & monetary policy would u recommend to eliminate the gap (include a graph to illustrate the relationship) By how much the government should change taxes to eliminate the gap?
Price Level 110 112 YearPotential GDP Real GDP 2015$12.2 rilion$12.0 trillion 2016 12.6 trillion 12.4 trillion...
Price Level 110 112 YearPotential GDP Real GDP 2015$12.2 rilion$12.0 trillion 2016 12.6 trillion 12.4 trillion Graph the AD, SRAS, and LRAS for 2015 and 2016 on the axes below. You can create your own scale on the axes. (Hint: AD and SRAS will intersect at the Real GDP and price level given) a. b. In 2015, does the economy have a recessionary gap (below potential GDP), inflationary gap (above potential GDP), or no gap (at potential GDP)? Why? In...
Suppose that real GDP is currently $13.88 trillion and potential real GDP is $14.0 trillion, or...
Suppose that real GDP is currently $13.88 trillion and potential real GDP is $14.0 trillion, or a gap of $1,000 billion. The government purchases multiplier is 3.3, and the tax multiplier is 2.3. Holding other factors constant, by how much will government purchases need to be increased to bring the economy to equilibrium at potential GDP? Government spending will need to be increased by $___ billion. (Enter your response rounded to the nearest whole number.) Holding other factors constant, by...
Suppose that potential GDP is $7.8 trillion and the equilibrium real GDP is $7 trillion. If...
Suppose that potential GDP is $7.8 trillion and the equilibrium real GDP is $7 trillion. If the Keynesian spending multiplier is 2, what is the level of fiscal stimulus (government spending) required to move the economy back to potential GDP? Show your work and explain.
Suppose that real GDP is currently $20.6 trillion, potential GDP is $22.7 trillion, the government purchases...
Suppose that real GDP is currently $20.6 trillion, potential GDP is $22.7 trillion, the government purchases multiplier is 1.0, and the tax multiplier is -1.2. Holding other factors (such as prices and interest rates) constant, how will taxes (T) need to change to bring the economy to equilibrium at potential GDP? Provide your answer in dollars measured in trillions rounded to two decimal places. Use a negative sign "-" for negative changes. Do not include any symbols, such as "$,"...
Suppose that real GDP is currently $20.5 trillion, potential GDP is $23.2 trillion, the government purchases...
Suppose that real GDP is currently $20.5 trillion, potential GDP is $23.2 trillion, the government purchases multiplier is 1.8, and the tax multiplier is -1.9. Holding other factors (such as prices and interest rates) constant, how will taxes (T) need to change to bring the economy to equilibrium at potential GDP? Provide your answer in dollars measured in trillions rounded to two decimal places.
help with part c please!!! Suppose that real GDP is currently 51.47 trillion potential GDP is...
help with part c please!!!
Suppose that real GDP is currently 51.47 trillion potential GDP is $1.53 trillion, the government purchases multiplier is 2, and the tax multiplier is -15 a. Holding other factors constant, government purchases will need to be increased by $ 0.03 trillion to bring the economy to equilibrium at potential GDP (Round fo four decimal places as needed.) b. Holding other factors constant, taxes have to be cut by $ 0.04 trillion to bring the economy...
Related to Solved Problem #4] Suppose that real GDP is currently $13.1 trillion and potential real...
Related to Solved Problem #4] Suppose that real GDP is currently $13.1 trillion and potential real GDP is $14.0 trillion, or a gap of $900 billion. The government purchases multiplier is 5.0, and the tax multiplier is 4.0 Holding other factors constant, by how much will government purchases need to be increased to bring the economy to equilibrium at potential GDP? Government spending will need to be increased by Sllon. (Enter your response rounded to the nearest whole number.)
Assume that equilibrium real GDP is $ 800 billion, potential real GDP is $ 950 billion,...
Assume that equilibrium real GDP is $ 800 billion, potential real GDP is $ 950 billion, the MPC is .80, and the MPI is .40. a. How much taxes fall to eliminate the GDP gap? b.If government spending and taxes both change by the same amount, how much must they change to eliminate the recessionary gap?
2. Suppose the economy is in long-run equilibrium, with real GDP at $19 trillion and the unemployment rate at 5%. Now assume that the central bank unexpectedly decreases money supply by 6%. a) Illust...
2. Suppose the economy is in long-run equilibrium, with real GDP at $19 trillion and the unemployment rate at 5%. Now assume that the central bank unexpectedly decreases money supply by 6%. a) Illustrate the short-run effects of the monetary policy by using aggregate demand-aggregate supply model. Be sure to indicate the direction of change in real GDP, the price level and the unemployment rate. b) Illustrate the long-run effects of the monetary policy by using aggregate demand-aggregate supply model....
Price Level 110 112 YearPotential GDP Real GDP 2015$12.2 rilion$12.0 trillion 2016 12.6 trillion 12.4 trillion Graph the AD, SRAS, and LRAS for 2015 and 2016 on the axes below. You can create your own scale on the axes. (Hint: AD and SRAS will intersect at the Real GDP and price level given) a. b. In 2015, does the economy have a recessionary gap (below potential GDP), inflationary gap (above potential GDP), or no gap (at potential GDP)? Why? In...
help with part c please!!!
Suppose that real GDP is currently 51.47 trillion potential GDP is $1.53 trillion, the government purchases multiplier is 2, and the tax multiplier is -15 a. Holding other factors constant, government purchases will need to be increased by $ 0.03 trillion to bring the economy to equilibrium at potential GDP (Round fo four decimal places as needed.) b. Holding other factors constant, taxes have to be cut by $ 0.04 trillion to bring the economy...
Related to Solved Problem #4] Suppose that real GDP is currently $13.1 trillion and potential real GDP is $14.0 trillion, or a gap of $900 billion. The government purchases multiplier is 5.0, and the tax multiplier is 4.0 Holding other factors constant, by how much will government purchases need to be increased to bring the economy to equilibrium at potential GDP? Government spending will need to be increased by Sllon. (Enter your response rounded to the nearest whole number.)
2. Suppose the economy is in long-run equilibrium, with real GDP at $19 trillion and the unemployment rate at 5%. Now assume that the central bank unexpectedly decreases money supply by 6%. a) Illustrate the short-run effects of the monetary policy by using aggregate demand-aggregate supply model. Be sure to indicate the direction of change in real GDP, the price level and the unemployment rate. b) Illustrate the long-run effects of the monetary policy by using aggregate demand-aggregate supply model....
Most questions answered within 3 hours.
-
SQL help:
Design a database diagram for a database that stores information
about the Downloads that...
asked 1 hour ago -
In 1970s and 1980s, molecular biologists discovered that the
hormone testosterone, binds a receptor protein that...
asked 3 hours ago -
january 1 2010 road catering service purchase a piece of
equipment for 58000 which is expected...
asked 3 hours ago -
Explain Mertons concept of anomie is and what the
modes of adaptation to it are?
asked 4 hours ago -
Jamie is doing a survey at her school about whether the students
feel the cafeteria food...
asked 5 hours ago -
How many liters of 0.669 M KOH will be needed to raise the pH of
0.339...
asked 8 hours ago -
A liquid of density 1270 kg/m 3 flows steadily through a pipe of
varying diameter and...
asked 8 hours ago -
Questions: What should the American executive do?
'A visiting American executive finds that a foreign subsidiary...
asked 8 hours ago -
Activity based costing was introduced as an alternative to
absorption costing.
1. Discuss using illustration the...
asked 8 hours ago -
1. You own shares of Crane DVD Company and are interested in
selling them. With so...
asked 8 hours ago -
How many grams of He are necessary to fill a balloon having a
volume of 4.5E3...
asked 8 hours ago -
The 2 patients, still in the hospital, were interviewed by a
MoH epidemiologist. The interviews revealed...
asked 8 hours ago