Consumption function: C=90+0.75Yd.   Investment function: I=75.   Government spending: G=100.   Net export: NX=50.   Net taxes: T=50.   Disposable income: YdY-T.   Equilibrium: Y=C+I+G+NX.   a. Solve for equilibrium income. Show your work below.   b. If autonomous investment decreases by 60, what is the new level of income? Show your answer on the same graph. Show your work below.   c. What is the value of the spending multiplier? Show your work below

Q: Suppose that every additional 3 percentage points in the investment rate boosts GDP growth by 1…

A: The economy with 3% additional investment experienced a GDP boost of 1%. All the investments are…

Q: Now assume you are examining a new economy. You learn that the mpc of this new economy is 0.75 and…

A: Given Information MPC = 0.75Change in Output level = 3,000so, Multiplier = 11 -mpc

Q: Discuss which of the following fall into the categories of consumption, investment, government…

A: Gross domestic product is the sum of the value added by all the production of goods and services in…

Q: Suppose that disposable income, consumption, and saving in some country are $200 billion, $150…

A: MPC is the marginal propensity to consume.  It is calculated as the change in Consumption divided by…

Q: 8. The income-expenditure model Consider a small economy that is closed to trade, so its net exports…

A: Hope you got your answer :)Please do rate this helpful.....

Q: 5. Algebra of the income-expenditure model Consider a small economy that is closed to trade, so its…

A: A closed economy is an economic model that defines that there is no international trade or any…

Q: Consider the following consumption function: C = 800 + 0.75 YD for the fictitious economy of…

A: Transfer-Payments(TP) have the opposite effect of Taxes(T). Taxes reduce the consumers…

Q: 8. The income-expenditure model Consider a small economy that is closed to trade, so its net exports…

A: Using the given information, the equilibrium level of income is:

Q: GDP would be: Select one:

A: The aggregate expenditure is the sum of all of the expenditures being undertaken in the economy by…

Q: Answer the next questions on the basis of the following information about a two-sector economy: Item…

A: In the above questions, we have used the formula : MPC = ∆C / ∆ Y  Multiplier = 1/ 1- MPC

Q: -0 -0 0 0 Aggregate Expenditures Schedule 32 C

A: The consumption(C) function depicts how much households spend on the consumption of services and…

Q: 8. Given the following on a closed economy. C = 40 +0.8Yd 1= 55 - 200. G=20 T = 20 Y. = 400 C=…

A: Equilibrium is reached when production equals aggregate expenditure, that is when income is equal to…

Q: MPC in an economy is 0.8. if investment is increased by dollar 5 million, how much would be increase…

A: Below is the given values: Increase in investment = 5 million Marginal propensity to consume = 0.8…

Q: Suppose the nation of Utopia has the following national income and product accounts. Depreciation 50…

A: Disclaimer :- as you posted multiple questions we are supposed to solve only the first one.…

Q: Use the following information to answer this question Assume the following information for an…

A: INTRODUCTION: GDP: Gross domestic product (GDP) is the monetary value of all the finished goods and…

Q: Give typing answer with explanation and conclusion Investment adds to the nation's stock of capital…

A: Investment in economics refers to the purchase of physical or financial assets with the expectation…

Q: 5. Assume an economy has not produced a single good or service so that Y=0. The economy however is…

A: Economic equilibrium is a condition or state in which economic forces are balanced. In effect,…

Q: Suppose that disposable income consumption and saving in some countries are 200 billion, 150 billion…

A: Suppose that disposable income=200 billion consumption=150 billion saving=50 billion…

Q: 1- In a country, if the consumption is OMR 14000, exports OMR 5300, government purchases are…

A: GDP The final monetary worth of products and services generated within a country over a given period…

Q: :55 Suppose that every additional 3 percentage points in the investment rate boosts GDP growth by 1…

A: The given information is:Every additional 3 percentage points in the investment rate boosts GDP…

Q: Consider the following information on a 4-sector (“private-public-open”) economy, where Y stands for…

A:

Q: Assume a closed economy with a GDP (Y) of 6,000. Consumption (C) is given by the equation C = 600+…

A: Aggregate expenditure: aggregate expenditure is the sum of consumption expenditure, investment…

Q: If the investment increases by 185 and the national income increases by 1200 billion what would be…

A:

Q: Define the term Projected annual net savings?

A: Projected annual savings means the estimated annual cost savings projected to be produced by a…

Q: 200 AGGREGATE EXPENDITURE (Billions of dollars) 20 20 40 60 660 80 80 100 120 140 160 180 40 AE Line…

A:

Q: Answer the following questions:   Instructions: Enter your answers rounded to the nearest whole…

A: MPC, marginal propensity to consume is the proportion of change in income that is spent on…

Q: Suppose the government increases expenditure towards education and training programs. The intended…

A: Answer: If the government increases spending towards education and training programs  then the…

Q: Suppose that autonomous consumption is 1,200, government purchases are 1,500, planned investment…

A: Gross Domestic Product, sometimes known as GDP, is a measurement of an economy's size and the entire…

Q: Given the following on a closed economy. C = 40 + 0.8Yd C= consumption I = 55 – 200r I= Investment G…

A: Given the closed economy, there would be no exports or imports.  C= 40+0.8Yd Here Yd is the…

Q: For each form of government spending, indicate whether it represents consumption or investment.…

A: In economics, consumption refers to the use of goods and services by people to satisfy their…

Q: 600 600 500 150 650 -50 700 700 575 150 725 -25 800 800 650 150 800 900 900 725 150 875 25 1,000…

A: (f). we already have autonomous consumption of $50 and MPC is 0.75. Initially planned expenditure is…

Q: Consider two nations, Spendia and Savia. The MPC for Spendia is 0.8, and the MPC for Savia is 0.5.…

A: HERE by using the MPC of the different nations we calculate the Multipliers and than we will…

Q: Q2) Using the data below derive equilibrium income for : a. A Private Closed Economy,. b. A Private…

A: A closed economy is one that does not interact with other economies in the world. There are no…

Q: 1. Use the following information from a fictional economy: Consumption, C = 250 + 0.8 Yd Investment,…

A: e part oy hand written