Suppose C = 9 + 0.75Y – 0.75T – 50r, I = 15 – 100r, T = 16, G = 21, and potential output is 125. r is the interest percent in decimal form, e.g. 2% is 0.02, and the output gap below is the $ output gap (actual GDP - potential GDP). What is these are IS equations for this economy? (Check all that apply. Some of these are equivalent so you should check more than one box.) output gap = 7– 600r OY- 125 = 7 – 600r r= 0.22 – 0.0016667(output gap) = (Y - 132)/600
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- Consider the following data for a closed economy: Y = $14 trillion C = $7 trillion G = $2 trillion = $ – 1.0 trillion %3D Spublic T= $4 trillion Use the data to calculate the following: (Enter your responses rounded to one decimal place.) a. Private saving is: $ trillion. b. Investment spending is: $ trillion. c. Transfer payments are: $ trillion. d. The government budget balance is: $ trillion and as a result the government budget is inConsider an economy described by the following equations:Y=C+I+GC=100+0.75(Y-T)I=500-50rG=125T=100wher Yis GDP,C is consumpton,I is investment,G is government purchases,T is taxes,and r is the interest rate.If the economy were at full employment that is , at its natural rate,GDP would be 2,000.a.Explain the meaning of each of these equations.b.What is the marginal propensity to consume in this economy?c.Suppose the central bank's policy is to adjust the money supply to maintain the interest rate at 4 percent,so r=4.Solve for GDP.How does it compare to the full employment level?d.Assuming no change in monetary policy,what change in government purchases would restore full employment?e.Assuming no change in fiscal policy,what change in interest rate would restore full employment?Refer to the following table for Waxwania: Government Expenditures, G Tax Revenues, T Real GDP $180 $90 $450 180 110 550 180 130 650 180 150 750 180 170 850 Instructions: In part a, enter your answers as a whole number. In part b, round your answer to 2 decimal places. a. Suppose that Waxwania is producing $550 of real GDP, whereas the potential real GDP (or full-employment real GDP) is $650. How large is its budget deficit? How large is its cyclically adjusted budget deficit? 2$ b. How large is its cyclically adjusted budget deficit as a percentage of potential real GDP? percent c. Is Waxwania's fiscal policy expansionary, or is it contractionary? (Click to select) V
- 1. Country X has following data: C = 20 + 0.8Y4, I = 30, G = 40, Tx = 20, T, = 15, X = 60, M = 20 + 0.04Y, incoming year growth target is 600, All figures is billion. Please calculate: a. National income equilibrium! b. Consumption and saving equilibrium! c. Government income from tax! d. How much change in government consumption if they want to achieve growth target?Consider the following data for a closed economy: Y = $12 trillion C = $8 trillion G = $2 trillion Spublic = $0.50 trillion T = $2 trillion Now suppose that government purchases increase from $2 trillion to $2.60 trillion but the values of Y and C are unchanged. What must happen to the values of S and I? O A. S increases by $0.60 trillion and I drops by $0.60 trillion. B. S and I drop by $0.60 trillion. C. S drops by $0.60 trillion and I increases by $0.60 trillion. D. S and I increase by $0.60 trillion.12. Suppose Congress wishes to reduce the budget deficit by reducing government spending. Use the AS-AD model to show what the impact will be of this change on GDP.
- Given the following information about each economy, either calculate the missing variable or determine that it cannot be calculated: Instructions: Enter your answer as a whole number. If you are entering a negative number be sure to include a negative sign (-) in front of that number. a. Suppose C = $20.1 billion, 1 = $3.5 billion, G = $5.2 billion, and NX = $-1 billion. Total income is (Click to select) ✓ b. Suppose total income is $1.3 trillion, G = $0.6 trillion, and C = $0.8 trillion. I is (Click to select) く c. Suppose total expenditure is $679 billion, C = $441 billion, I = $125 billion, and G = $83 billion. NX is: $ billion. Exports (Click to select) ✓. Find the equilibrium level of national income in the basic Keynesian macroeconomic model: Y=C+I+G C=20+0.75Yd Yd=(1-t)Y20. Assume that an economy is characterized by the following equations: а. C=100+(2/3)(Y-T) T=600 G=500 I=800-(50/3)r M/P=M/P=0.5Y-50r Write the numerical IS curve for the economy, expressing Yas a numerical function of G, T, and r. b. Write the numerical LM curve for this economy, expressing r as a function of Y and M/P. C. Solve for the equilibrium values of Yand r, assuming P=1.0 and M=1,200. How do they change when P=2.0? Check by computing C, I, and G. d. Write the numerical aggregate demand curve for this economy, expressing Yas a function of G, T, and MP.
- 1) Assume that Canadian government taxes away $0.15 of each dollar of new income, that 35% of the remaining $0.85 of disposable income is spent on imports, and that 2% of disposable income is saved. Enter your responses below rounded to 2 decimal places. a. The marginal propensity to withdraw is . b. From each new dollar of income $ is spent on domestic consumption items.c. The value of the Canadian spending multiplier is . 2) In each case below a particular fiscal policy affects an economy's AD curve via the spending multiplier. Calculate the spending multiplier and find the direction and size of the shift in the AD curve. Enter your responses for the spending multiplier rounded to 2 decimal places, and size of the shift of the AD curve rounded to 1 decimal place. Do not put minus signs in your answers. a. If government purchases increase by $3 billion in an economy with an MPW of 0.65 then the spending multiplier is and the AD curve finally shifts to the by $…What is general government final consumption reflecting in terms of GDP of a country? What it indicates when the value is high or low?n year 2018, the government of Qatar spent is 143 billion Qatari Riyal (the national currency of Qatar). The GDP of Qatar in the same year is 1,121 billion Qatari Riyal. Qatar's desired consumption and desired investment during the year can be summarized by the following equations: Cd=1,000-5,000r Id=800-3000r Where Cd is the desired consumption in billions of Qatari Riyal, Id if the desired investment in billions of Qatari Riyal, and r is the real interest rate in decimal form. What is the equilibrium real interest rate r* in %? round to at least 2 decimal places