Actual investment equals saving: a) at all levels of GDP. b)at all below-equilibrium levels of GDP. c) at all above-equilibrium levels of GDP. d) only at the equilibrium GDP.

True/False  An increase in savings implies a decrease in consumption and therefore a decrease in GDP.

true/false explain When savings equals investment, reducing savings and increasing consumption is especially effective in stimulating output.

Output (Y): 10,000 Government Spending (G): 1,500 Desired Consumption (C): 8,500 If the goods market is in equilibrium for a closed economy, what is the desired level of investment?

In a closed economy, subsistence consumption is 10 billions, households spend 60% of their net disposable income on leisure consumption, investment is constant at 40 billions, taxes are 20 billions, government spending is 20 billions and the gross domestic product is 145 billions. Assume that suppliers always respond to variations in demand, that it takes them 1 month to adjust to new demand levels and that they make adjustments once per month (if any). One day, the government increases its spending to 30 billions.   After 2 months (at the end of the 2nd month), by how much has the gross domestic product increased?   Select one:   a. 16 b. 25. c. 32 d. 50

During recessions investment   falls by a larger percentage than GDP. falls by about the same percentage as GDP. falls by a smaller percentage than GDP. falls but the percentage change is sometimes much larger and sometimes much smaller

Suppose GDP is $800 billion, taxes are $150 billion, private saving is $50 billion, and public saving is $20 billion. Assuming this economy is closed, calculate consumption, government purchases,  national saving, and investment.

Explain how the current level of investment depends on the following factors: 1) the current level of national income; 2) the current level of the interest rate; 3) the expected net profits in future time periods; 4) the expected interest rates in future time periods; 5) the current level of profit.

Assume a closed economy with a GDP (Y) of 6,000. Consumption (C) is given by the equation C = 600+ 0.6(Y -T). Investment (I) is given by the equation I = 2,000- 100i, where i is the nominal rate of interest (in percent). Taxes (T) are 500 and government spending (G) is also 500. (a) What is the autonomous consumption? (b) What is the autonomous spending? (c) What is the marginal propensity to consume?

A decrease in a country's capital stock occurs when Multiple Choice ____ businesses sell machinery and equipment to one another. ____ the prices of investment goods rise faster than the prices of consumer goods. ____ businesses have larger inventories at the end of the year than they had at the start. ____ the consumption of fixed capital exceeds gross domestic investment.