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- hich theory of consumption best explains the consumption behavior of consumers of our economy? Question No: 02 [Marks: 10] If the State Bank started printing large quantities of Pakistani Rupees (Rs), what would happen to the number of Pakistani Rupees a dollar could buy? Why? Question No: 03 [Marks: 10] Deseribe the difference batuuean foreian diract investmet and foraion nortfolie invastment Who is mora likelu toAssume in a simple economy that thc level of saving is -500 when aggregate ourput equals zero and that the margina! propensity to save is 0.2. Derive the saving function and the consumption function, and draw a graph showing these func- tions. At what level of aggregate ouiput does the consumption curve cruss the 45° line? Explain your answer and show this un the graph.1f the Consumption funchon, espressedas C=30+0,7Yd, chayes to C=20+028Yd. which of the fellowing will accaur? OThe Cansumption function Shifts.doon in. Parallel. 6 its slope Anckeases as the Consumpion functionmaes up O Hs Slape ockeases as the Sausing function. slides up its Slope 1wereases as the Consumption function. slides dacana O it sope deExeAses as the Saurisq function. sltdes down. the Sauting
- Mc Graw Hill The table below shows some of the expenditure amounts in the economy of Arkinia. The MPC, the MTR, and the MPM are all constant, as are the values of the three injections. a. Complete the table below. Y 0 100 200 300 400 500 608 700 808 T 800 20 40 60 80 100 120 140 160 180 YD 60 -20 140 220 300 380 460 540 620 C 130 195 325 260 이 455 65 390 520 The Economy of Arkinia S +5 10 40 -20 100 25 55 70 85 Tools I 50 50 50 50 50 50 50 50 50 O Search G 180 180 180 180 180 180 180 180 180 < Prev kriste 10 of 10 X 50 50 50 50 58 50 50 50 50 i SAMSUNG IM 40 50 60 Next 10 20 30 70 80 90 200m Draw a 45° line (labelled Y) and the aggregate expenditure function, labelled AE₁. Identify expenditure equilibrium with the letter e Use the tool "e1" to show the expenditure equilibrium. Plot only the endpoints of Y and AE. Once all points have been plotted, click on the line (not individual points) and a tool icon will pop up. You can use this to enter exact co-ordinates for your points as…Suppose you have the following disposable income and consumption data for a country, as shown in the table below Disposable income and Consumption BENp e e (dllar 13,000 227,000 3,400 E4,300 1,000 AUsing the information in the table, graph the consumption schedule for this country Instructions Use the tool provided C' to plot the consumption line polnt by point points total. Use the tool Equnibrium to indicate where consumption equals disposable income. Consumption Schedule Conumption (dollarn) 21.000 lave 27000 26000 25000 24.000 23,000 22,000 21000 20,000 20,000 22000 26.000 24.000 28,000 Disposable income (dollars) &What is the stope of the consumpton schedule? Instructions Round your answer to 1 decimal place1. What would happen to multiplier if investment were to be positively related to income? 2. is it possible for total saving to fall when people beome more thirfty? 3. What is meant by multiplier?Why shoul the value of multiplier rise when people spend more on consumption?
- Assume that in 2016, the followng prevals n the Republic of Nurd Goverment spending (0) 50 Not taxos (T)- 50 Planned investment - S30 Assume that househoids in Nurd censume 75 percent of heir income, they save 25 percent of their income. Thun, the consumption function and saving function of Nurd re C-075Y, and S=025Y. where disposabile income YY-T Determine the equilitrium level of income Equilibrium income =$(Enter your reaponse as an integer.)The table below provides income and consumption data in billions of dollars: Disposable Income Consumption Savings 100 80 --- 200 150 --- What is the level of consumption when income is $300 billion? A) $200 billion B) $240 billion C) $210 billion D) $60 billionExplain two effect of public expenditure on the investment??
- Explain how does adecrease in the current income y affect the consumer’s consumption-saving decision. In particular,explain: 1) How will current consumption c, future consumption c′, and savings s change; 2) Arethere any substitution effect or income effect. Make sure you draw two figures, one for the borrowersand one for the lenders40. If the expenditure mutiplier in a closed economy without govemment activites equais 4 what is the MPC in ths economy? a. 025 b. 0.20 C. 0.75 d. 0.80 Use the information below to answer questions 41-43. In an economy at zero disposable income consumption is 1200 milion. The marginal propensity to save in this economy is 0.25 41. What is the consumption function for this economy? a. C 1200 0.25Yd b. C 1200 0.75YA C C-0+0.75Yd d. C=-1200 25Yda 42.If Yd = 6000 milion, what is consumption expenditure in this economy? a. 6000 million b. 5700 million e. 7200 millon d. 5200 million 43. What is saving in this economy at Yd= 6000 milion? a -1200 b. 300 C. 1200 d. 300 44. An increase in minimum wages unmatched by high productivity leads to a. demand pull inflation b. cost push inflation e. imported inflation d. creeping infation 45 Full employment occurs when a. actual output exceeds potential output b. actual output is less than potential output C. actual output is equal to potential output…Only typed answer Holly's break-even level of income where her consumption equals disposable income is $980 and her MPS is 0.17. If her actual disposable income is $1,337, her level of consumption spending must be $
