Consider the following economy : C=100+0.8 Y I= 50 - 25i G= T= 50 M' -=200 Md = Y – 25 i 1. Calculate the IS and LM curves. 2. Calculate the equilibrium levels of output and interest.

Consider an economy described by the following equations: Y = C + I + G Y = 6100 G = 1100 T = 1100 C = 1000 + .75(Y - T) I = 1100 - 60r in this economy compute private savings, public savings and national savings Find the equilibrium interest rate Now suppose that G rises to 1200. Compute private savings, public savings and national savings. Find the new equilibrium interest rate.

Assistance with the following question: Consider an economy described by the following equations: Y=C + I +G Y=7,000 G=4000 T=2,000 C=150+0.75(Y-T) I=1,000-50r —————————————— a. In this economy, compute private saving, public saving and national saving. b. Calculate the equilibrium interest rate.

18. Deriving net exports By definition, net exports from Japan are equal to exports from Japan minus imports into Japan. In a hypothetical two-country world, imports into Japan are equal to exports from the United States. So the value for net exports from Japan is equal to exports from Japan minus exports from the United States. Graphically, at each exchange rate, the value for net exports is the horizontal distance from U.S. exports to Japanese exports. Use the graph input tool to answer the following questions. You will not be graded on any changes you make to this graph. (Note: To avoid dealing with decimal places, this calculator reports the price of yen in terms of dollars per 1,000 yen. That is, the price on the vertical axis is the dollar price of a 1,000-yen note instead of a single yen. As you have already seen, a price of 8 dollars per 1,000 yen is the same as 125 yen per dollar. Once you enter a value in a white field, the graph and any corresponding amounts in each grey…

How do you explain why investment falls as interest rate rises

2. Assume a closed economy where the consumption, investment, and government expenditure are C = 350 + 0.3Y; | = 120 - 40r; G = 120 II What is the value of real interest rate which clears the good market when Y (income ) equal to $ 600. Hint (find IS equation first) * 5.5 5.6 4.25 5.9

An economy is described by the following equations: C= 2,600+ 0.8(Y-T) - 10,000r IP = 2,000-10,000r G = 1,800 NX = 0 PAE = C+1²+ GANX T = 3,000, Where the definitions of each variables are the same as our lecture notes. The real interest rate, r, expressed as a decimal, is 0.10 (that is, 10 percent). a. Find a numerical equation relating planned aggregate expenditure to output. b. Solve for short-run equilibrium output. c. Show your result graphically using the Keynesian-cross diagram. d. Now, suppose that potential output Y* equals 12,000. What real interest rate should the Fed set to bring the economy to full employment? e. Recalculate question (d) for the case in which potential output Y* equals 9,000.

Consider the following data for a closed economy: Y = $11 trillion C = $10 trillion G = $2 trillion Spublic = $-0.5 trillion T = $1 trillion Use these data to calculate the following: a. private saving, b. investment spending, c. transfer payments and d. the government budget balance. a. Private saving is: $ trillion. (Round your responses to one decimal place.) b. Investment spending is: $ trillion. (Round your responses to one decimal place.) c. Transfer payments are: $ trillion. (Round your responses to one decimal place.) d. The government budget balance is: $ trillion and as a result the government budget is in (Round your responses to one decimal place.)

QUESTION 2 Consider the closed-economy market-clearing model. Assume that the marginal propensity to consume is 0.8. Tax revenue decreases by $5 billion, while output and government spending remain the same (a) Calculate the dollar change in consumption. (b) Calculate the dollar change in national saving. (c) Does the equilibrium real interest rate increase, decrease, or stay the same? n toolhar nress ALT+F10 (PC) or ALT+FN+F10 (Mac).

Suppose we start with a general equilibrium, and the economy experience an improvement in payment technology. Which of the following statements correctly describes the difference between the initial general equilibrium and the final general equilibrium  1. the real interest rate is greater under the final equilibrium 2. the real interest rate is smaller under the final equilibrium 3. the real interst range does not change under the final equilibrium 4. None of the above