All of the following are flow variables except:
(a) consumer's monthly savings
(b) the quarterly government budget deficit
(c) the annual investment
(d) the amount of capital in the economy
Option (d).
Monthly savings is measured over a period of 1 month. Quarterly budget deficit is measured over a period of 1 quarter. Annual investment is measured over a period of 1 year. So all these 3 are flow variables. Since amount of capital in economy is measured as at a particular point of time, it is a stock variable.
All of the following are flow variables except: (a) consumer's monthly savings (b) the quarterly government...
Recall that national savings (S) is the sum of private savings and public savings. S = SP + S a. Show that private savings can be written as a function of investment, the current account and the government's budget deficit. (3 marks) b. Show that the current account can be written as a function of private savings, investment and the government's budget deficit. What does this imply about the ways that the government can reduce the current account deficit? (3...
Which of the following economic variables is a stock variable? A) Nominal GDP B) Government Debt C) Capital Investment D) All are stock variables
(15) All of the following would be considered capital goods, except o a dump truck. o a new factory o on-the-job training. All of the above are capital goods. (16) What are the sources of savings in the economy? Business savings and household savings Private savings by households, government savings, and savings by foreigners - The difference between income and spending of households The difference between income and spending of households and businesses (17) How is the level of investment...
Which of the following is an example of a flow variable? A. Housing B. Capital O c. Wealth OD. The government budget deficit.
it is budget surplus, rather than
deficit
4. Suppose the market for loanable funds is current in equilibrium, with zero capital inflows or capital outflows and zero government budget deficit. (a) Using a supply and demand diagram, depict this situation. 5 points. (b) Suppose the government begins to run a budget surplus; assuming all else equal, depict the effect this will have on the interest rates and total lending. 5 points. (c) What effect will this deficit have on the...
Among the most important problems of implementing fiscal policy include all except which of the following? Correctly timing the desired fiscal stimulus, given the inevitable lags and forecasting errors Determining how large a stimulus to apply Assessing when policy actions should be reversed Determining how long a time lag to apply If the central bank does not use accommodating monetary policy, a fiscal stimulus is likely to increase interest rates, which in turn, will cause planned investment to decrease. What...
Consider an economy in long run equilibrium described by the following equations: Y = C + I + G + NX Y = 5000 G = 1000 T = 1000 C = 250 + 0.75*( Y - T ) I = 1000 - 50*r NCO = 500 - 50*r Where r is the real interest rate (in % terms). Suppose G rises to 1250 without any change in T. Solve again for the equilibrium real interest rate and the rest...
The options are : National savings = (Y - C - G)
or (Y-C) or (G-T)
or (Y-T-G)
for the second blank under National Savings the options are (Y)
or (I) or (C) or
(G)
The options are : Private savings = (Y - C - T)
or (Y - T - I) or (T - G)
or (C -T)
The options are : Public Savungs = (Y - C - T)
or (Y - T - I) or (T...
3) Long-run economic growth requires all of the following except a. technological change. b. government provision of secure property rights. c. increases in capital per hour worked. d. political instability.
What is functional finance? A. A view that because the Ricardian equivalence theorem is true in theory and practice, the government should not use deficit spending. B. A view that government should make spending and taxing decisions on the basis of their effect on the economy rather than concern itself with balancing the budget. ° C. A moral view that the government budget should always be balanced except in wartime. O D. A view that deficit spending will crowd out...