8. Given the following on a closed economy. C= consumption C = 40 + 0.8Yd 1 = 55-200r G = 20 T = 20 Ye = 400 I= Investment G = government spending T = Taxes Ye National Income r = rate of interest Determine the following: The equilibrium level of consumption The level of investment The level of interest rate

8. Given the following on a closed economy. C= consumption C = 40 + 0.8Yd 1 = 55-200r G = 20 T = 20 Ye = 400 I= Investment G = government spending T = Taxes Ye National Income r = rate of interest Determine the following: The equilibrium level of consumption The level of investment The level of interest rate

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter9: Aggregate Demand

Section: Chapter Questions

Problem 1.1P

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1. Given the following on a closed economy.C = 40 + 0.8Yd C= consumptionI = 55 – 200r I= InvestmentG = 20 G = government spendingT = 20 T = TaxesYe = 400 Ye = National Income r = rate of interestDetermine the following:-The equilibrium level of consumption-The level of investment-The level of interest rate-The level of Private savings-The level of Public savings-The level of national savings
GDP $0 1 2 Consumption $0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 D 8 4.5 As shown in Exhibit 9-1, if equilibrium GDP is $5 trillion, then the total of investment, government spending, and net exports is: 8 4.5 As shown in Exhibit 9-1, if equilibrium GDP is $5 trillion, then the total of investme O $1 trillion. $2 trillion. O $3 trillion. O $4 trillion. $6 trillion. 4 Aggregate Expenditures 6 Unplanned inventory
Given the following on a closed economy.C = 40 + 0.8Yd C= consumptionI = 55 – 200r I= InvestmentG = 20 G = government spendingT = 20 T = TaxesYe = 400 Ye = National Incomer = rate of interestDetermine the following:a. The equilibrium level of consumptionb. The level of investmentc. The level of interest rated. The level of Private savingse. The level of Public savingsf. The level of national savings
What is the relative importance of consumption spending (C) in aggreagte demand and some factors that affect it? What is the relative importance of investment spending (I) in aggreagte demand and some factors that affect it? What is the relative importance of government spending (G) in aggreagte demand and some factors that affect it? What is the relative importance of Net Export (NX) (Net Export = spending on exports (X) - imports (M)) in aggreagte demand and some factors that affect it?
Question 1Given the following on a closed economy.Question 2C = 40 + 0.8Yd I = 55 – 200rG = 20T = 20Ye = 400C= consumption I= InvestmentG = government spending T = TaxesYe = National Income r = rate of interestDetermine the following:a. The equilibrium level of consumptionb. The level of investmentc. The level of interest rated. The level of Private savingse. The level of Public savingsf. The level of national savingsa. Considering the determinants of productivity, list and explain some things that would tend to prohibit or limit a poor country’s ability to catch up with rich ones.b. Economist believe there is a strong correlation between productivity and the standard of living? Discuss.[HINT: In your answer be sure to explain what productivity and standard of living mean. Make a list of things that determine labour productivity and explain how each of them have an impact on the standard of living.] ( A B C ) SOLVED
Question 1Given the following on a closed economy.Question 2C = 40 + 0.8Yd I = 55 – 200rG = 20T = 20Ye = 400C= consumption I= InvestmentG = government spending T = TaxesYe = National Income r = rate of interestDetermine the following:a. The equilibrium level of consumptionb. The level of investmentc. The level of interest rated. The level of Private savingse. The level of Public savingsf. The level of national savingsa. Considering the determinants of productivity, list and explain some things that would tend to prohibit or limit a poor country’s ability to catch up with rich ones.b. Economist believe there is a strong correlation between productivity and the standard of living? Discuss.[HINT: In your answer be sure to explain what productivity and standard of living mean. Make a list of things that determine labour productivity and explain how each of them have an impact on the standard of living.]
25 1 Calculate the equilibrium level of investment if you have the following equations: C=0.4Yd+20, national income is 1000, government expenditures is 200, tax is 50 Investment =300 O Investment-D350 O Investment3D400 O Investment3D450 O None of the above O
1.In Figure 1, when disposable income is 0, how much is consumption, saving, autonomous consumption, and induced consumption? 2.In Figure 1, when disposable income is 2500, how much is consumption, saving, autonomous consumption, and induced consumption? 3.In Figure 1, when disposable income is 4,000, how much is the consumption, savings, autonomous consumption and induced consumption?
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The diagram below shows the consumption schedule for a private closed economy. The level of planned investment is $6 billion. a. Using the diagram, draw the aggregate expenditures schedule for this economy and then identify equilibrium GDP. Instructions: (1) Use the tool provided 'C + I'to draw the aggregate expenditures schedule for this economy. (2) Use the tool provided 'Equilibrium' to identify the new equilibrium GDP. Aggregate Expenditures Schedule 50 Tools 40 C+1 Equilibrium 30 20 10 10 20 30 40 50 Real GDP (billions of dollars) Instructions: In part b, enter your answer as a whole number. In part c, round your answer to 1 decimal place. b. What is the equilibrium GDP for this country? billion c. What is the marginal propensity to consume for this country? Aggregate expenditures (billions of dollars) 18
Given the following on a closed economy.C = 40 + 0.8Yd C= consumptionI = 55 – 200r I= InvestmentG = 20 G = government spendingT = 20 T = TaxesYe = 400 Ye = National Incomer = rate of interest Find: The level of Private savingsThe level of Public savingsThe level of national savings
ON 102 LEC 850 - Winter 2023 - INTRODUCTION TO MACROEC ard / My courses / ECON 102 (LEC 850 Winter 2023) General / S on 12 ed out of on ve Progress Which of the following changes in personal income tax would lead to the smallest increase in consumption? O a. a $30 000 decrease in taxes, if MPC equals 0.25 O b. a $15 000 decrease in taxes, if MPC equals 0.6 O c. a $20 000 decrease in taxes, if MPC equals 0.5 O d. a $12 000 decrease in taxes, if MPC equals 0.75 O e. e. a $10 000 decrease in taxes, if MPC equals 0.2 Previous page Time left 4:58:21 Last saved at 22:40:19 cross out cross out cross out cross out cros ut Finish attempt ... Quiz nav 1 7 2 8 Finish att