Assume that the foreign economy is characterized by the same equations as the domestic economy (with asterisks reversed). Use the two sets of equations to solve for the equilibrium output of each country. (Hint: Use the equations for the foreign economy to solve for Y* as a function of Y and substitute this solution for Y* in part (a).) What is the multiplier for each country now? Why is it different from the open economy multiplier in p

Consider an open economy with a current population of 0.55 million people, and where the potential GDP is $ 3.24 billion. Consumer expenditure is represented by the following equation: C = 60+ 0.75DI. Exports are constant at $500 million, and investors want to spend $ 400 million at every level of income. The government purchases are $300 million, imports are constant at $ 450 million, and taxes are $200 million. - What is the current equilibrium level of real GDP? (report your answer at 2 decimal places and in millions of dollars)

Can you help me this question Explain the short-run impact upon net exports and GDP of the following in the multiplier model, using Table 28-1 where possible: An increase in investment (I ) of $100 billion A decrease in government purchases (G) of $50 billion An increase in foreign output which increased exports by $10 billion A depreciation of the exchange rate that raised exports by $30 billion and lowered imports by $20 billion at every level of GDP

Discuss which of the following fall into the categories of consumption, investment, government expenditure and net exports from the Y = C + I + G + NX (X – M) identity, and whether the impact is to increase or decrease GDP. Thomas buys a new house

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Consider the following information on aggregate income, consumption expenditure, and planned investment for a country: Aggregate Output/Income $3,950 4,150 Planned Consumption Investment $3,610 3,770 3,930 4,090 4,250 4,410 4,570 4,730 $500 500 4,350 4,550 4,750 4,950 500 500 500 500 5.150 500 5,350 500 When aggregate income is $4,350, O A. saving is $420 and unplanned investment (inventory change) is - $80. B. saving is $40 and unplanned investment (inventory change) is - $80. OC. saving is - $420 and unplanned investment (inventory change) is $500. O D. saving is - $80 and unplanned investment (inventory change) is $500. The equilibrium level of output/income is S (Enter your response as an integer.) Based on the information above, calculate the MPC and MPS. MPC =|. (Round your response to two decimal places.) MPS = (Round your response to two decimal places.)

In the small closed economy of Bonretia, the currency is the denar. Statistics for last year show that private saving was 50 billion denars, taxes were 40 billion denars, government purchases of goods and services were 30 billion denars, there were 20 billion denars in transfer payments by the government, and GDP was 70 billion denars. What were consumption and investment in San Bonretia? Please read carefully before solve

The table below shows the parameters for the economy of Hutu. Give your answers to one decimal point. XN = 160 0.15Y G = 220 C = 40 + 0.65Y I = 150 a. The value of equilibrium income is $ b. If exports were to increase by 40, the new value of equilibrium income would be $ c. Given your answer in part (b), the new value for XN is $ d. Given the equilibrium income in part (a), if full employment income is $800, what change in government spending is necessary to move the economy to this level? Government spending needs to decrease by $. A

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