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13./The economy has GDP is Y - 160; Consumption is C = 120 - 500 r; Taxes are T = 10; and Government purchases are...
2. The country, Hoosier (a closed economy), has the following data: GDP: Y = 1200, Consumption:...
2. The country, Hoosier (a closed economy), has the following data: GDP: Y = 1200, Consumption: C = 600 – 10,000 r, Taxes: T = 200, Government purchases: G = 300. The investment is I = 700 – 10,000 r a. Use the information above to find the supply and demand equations for loanable funds: i. Supply equation: ii. Demand equation: _ b. What is the equilibrium interest rate, r, and what are national saving and investment, S and I?...
Consider the economy of Wiknam. The consumption function is given by C = 250+ 0.6(Y-T). a....
Consider the economy of Wiknam. The consumption function is given by C = 250+ 0.6(Y-T). a. Government purchases and taxes are both 100. In the accompanying diagram, graph the IS curve for r ranging from 0 to 8 by dragging and dropping the end points to the correct locations b. The money supply M is 2,875 and the price level Pis 5. In the accompanying diagram, graph the LM curve for r ranging from 0 to 8 by dragging and...
2. The country, Hoosier (a closed economy), has the following data: GDP: Y = 1200, Consumption:...
2. The country, Hoosier (a closed economy), has the following data: GDP: Y = 1200, Consumption: C=600 - 10,000 r, Taxes: T = 200, Government purchases: G=300. The investment is I = 700 - 10,000 a. Use the information above to find the supply and demand equations for loanable funds: (i) Supply equation: 360 + 10,000+ sex theri um ii. Demand equation: 300 - 10.000 equat to b. What is the equilibrium interest rate, r, and what are national saving...
Real interest rate (percent per year) 9.07 SLF The graph shows the supply of loanable funds...
Real interest rate (percent per year) 9.07 SLF The graph shows the supply of loanable funds and the demand for loanable funds in an economy Suppose the government has a budget deficit of $0.2 trillion and the Ricardo-Barro effect holds. Draw the new demand for loanable funds curve. Label it. Draw the new supply of loanable funds curve. Label it. Draw a point that shows the equilibrium quantity of loanable funds and interest rate. The Ricardo-Barro effect is the proposition...
please, don't pay attention to the lines in the graph. I know it's wrong. 90- SLF...
please, don't pay attention to the lines in the graph.
I know it's wrong.
90- SLF HIYO UWODOU VITUGUIG ITUO HUU UGUI GUID funds in an economy Suppose the government has a budget deficit of $0 2 trillion and the Ricardo-Barro effect holds. Draw the new demand for loanable funds curve. Label it Draw the new supply of loanable funds curve. Label it Draw a point that shows the equilibrium quantity of loanable funds and interest rate. 20- SUF 7.04...
Part 2: Questions from the Instructor 1. The following equations describe the macro-economy: Consumption function: C...
Part 2: Questions from the Instructor 1. The following equations describe the macro-economy: Consumption function: C = 50 + 0.5 (Y-T) Government spending: G = 100 Real Money supply: M/P 100 Real Money demand: Md/P-2Y-20000/ Taxes: T 0.2Y Investment: 200- 10000i Notice that taxes are no longer fixed: they are proportional to the amount of income. a) Derive the IS and LM curves. b) Calculate the equilibrium output and interest rate. c) At the equilibrium, is the government having a...
Consider the economy of Hicksonia a. The consumption function is given by C = 200 +...
Consider the economy of Hicksonia a. The consumption function is given by C = 200 + 0.6(Y- T). The investment function is I = 200 - 40r. Government purchases and taxes are both 100. For this economy, graph the IS curve for r changing from 0 to 8. b. The money demand function in Hicksonia is (M/P)d = Y - 100r The money supply M is 1000 and the price level P is 2. For this economy, graph the LM...
An economy is described as follows: C-100 + 8Yp + .05 X 150 G 300 ....
An economy is described as follows: C-100 + 8Yp + .05 X 150 G 300 . I 200 T2X IM - 100 + .147 nominal wealth and is fixed at 1.000 throughout the problem. All other symbols have their usual meanin Part I. Let P1 A. Find equilibrium GDP, the budget deficit or surplus and the trado deficit or surplus.. B. Now suppose the tax rate is cut so that T = .0757 . . with P still fixed at...
Let assume an economy in this year with the following loanable funds (LF) market demand equation....
Let assume an economy in this year with the following loanable funds (LF) market demand equation. Demand: r = 8 – 0.005 * Qp Where, r is the real interest rate (ifr=12 then the interest rate is 12%), Q, in the quantity demanded of loanable funds (total investment). The government expenditures (G) is $300 billion, collected taxes (T) equal to $700 billion, and private saving is $800 billion. 1. Calculate the value of government savings in this economy. Is the...
(25pts) 2. Suppose the government wants to reduce its budget deficit. Using the long-run model of...
(25pts) 2. Suppose the government wants to reduce its budget deficit. Using the long-run model of the economy developed in Chapter 3, illustrate graphically the impact of the alternative fiscal policy measures indicated in parts (a) and (b) below. Be sure to label: (i) the axes, (ii) the curves, (iii) the initial equilibrium values; (iv) the direction curves shift; and (v) the final equilibrium values. (15) a) Suppose the government decides to reduce the government's budget deficit by reducing government...
2. The country, Hoosier (a closed economy), has the following data: GDP: Y = 1200, Consumption: C = 600 – 10,000 r, Taxes: T = 200, Government purchases: G = 300. The investment is I = 700 – 10,000 r a. Use the information above to find the supply and demand equations for loanable funds: i. Supply equation: ii. Demand equation: _ b. What is the equilibrium interest rate, r, and what are national saving and investment, S and I?...
Consider the economy of Wiknam. The consumption function is given by C = 250+ 0.6(Y-T). a. Government purchases and taxes are both 100. In the accompanying diagram, graph the IS curve for r ranging from 0 to 8 by dragging and dropping the end points to the correct locations b. The money supply M is 2,875 and the price level Pis 5. In the accompanying diagram, graph the LM curve for r ranging from 0 to 8 by dragging and...
2. The country, Hoosier (a closed economy), has the following data: GDP: Y = 1200, Consumption: C=600 - 10,000 r, Taxes: T = 200, Government purchases: G=300. The investment is I = 700 - 10,000 a. Use the information above to find the supply and demand equations for loanable funds: (i) Supply equation: 360 + 10,000+ sex theri um ii. Demand equation: 300 - 10.000 equat to b. What is the equilibrium interest rate, r, and what are national saving...
Real interest rate (percent per year) 9.07 SLF The graph shows the supply of loanable funds and the demand for loanable funds in an economy Suppose the government has a budget deficit of $0.2 trillion and the Ricardo-Barro effect holds. Draw the new demand for loanable funds curve. Label it. Draw the new supply of loanable funds curve. Label it. Draw a point that shows the equilibrium quantity of loanable funds and interest rate. The Ricardo-Barro effect is the proposition...
please, don't pay attention to the lines in the graph.
I know it's wrong.
90- SLF HIYO UWODOU VITUGUIG ITUO HUU UGUI GUID funds in an economy Suppose the government has a budget deficit of $0 2 trillion and the Ricardo-Barro effect holds. Draw the new demand for loanable funds curve. Label it Draw the new supply of loanable funds curve. Label it Draw a point that shows the equilibrium quantity of loanable funds and interest rate. 20- SUF 7.04...
Part 2: Questions from the Instructor 1. The following equations describe the macro-economy: Consumption function: C = 50 + 0.5 (Y-T) Government spending: G = 100 Real Money supply: M/P 100 Real Money demand: Md/P-2Y-20000/ Taxes: T 0.2Y Investment: 200- 10000i Notice that taxes are no longer fixed: they are proportional to the amount of income. a) Derive the IS and LM curves. b) Calculate the equilibrium output and interest rate. c) At the equilibrium, is the government having a...
An economy is described as follows: C-100 + 8Yp + .05 X 150 G 300 . I 200 T2X IM - 100 + .147 nominal wealth and is fixed at 1.000 throughout the problem. All other symbols have their usual meanin Part I. Let P1 A. Find equilibrium GDP, the budget deficit or surplus and the trado deficit or surplus.. B. Now suppose the tax rate is cut so that T = .0757 . . with P still fixed at...
Let assume an economy in this year with the following loanable funds (LF) market demand equation. Demand: r = 8 – 0.005 * Qp Where, r is the real interest rate (ifr=12 then the interest rate is 12%), Q, in the quantity demanded of loanable funds (total investment). The government expenditures (G) is $300 billion, collected taxes (T) equal to $700 billion, and private saving is $800 billion. 1. Calculate the value of government savings in this economy. Is the...
(25pts) 2. Suppose the government wants to reduce its budget deficit. Using the long-run model of the economy developed in Chapter 3, illustrate graphically the impact of the alternative fiscal policy measures indicated in parts (a) and (b) below. Be sure to label: (i) the axes, (ii) the curves, (iii) the initial equilibrium values; (iv) the direction curves shift; and (v) the final equilibrium values. (15) a) Suppose the government decides to reduce the government's budget deficit by reducing government...
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