ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Suppose output and income is equal to 16100, the marginal propensity to consume is 0.65, and autonomous consumption is 675. Calculate total saving for this economy, assuming no public or foreign sector. (Round your answer to the nearest whole number.)
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- Assume that GDP ( y) is 6.000. Consumption (C) is given by the equation C= 600 + 06(Y-T). Investment (I )is given by the equation I=2,000- 100r, where r is the real rate of interest in percent. Taxes (T) are government spending (G) is also 500 a. What are the equilibrium values of C, I, and r? b) What are the values of private saving, public saving, and national saving? ·arrow_forwardSuppose that in a closed economy GDP is equal to 15,000, government purchases are equal to 3,000, consumption equals 10,500, and taxes equal 3,500. What are private saving and public saving? Group of answer choices 1,500 and -500, respectively 1,500 and 500, respectively 1,000 and -500, respectively 1,000 and 500, respectivelyarrow_forwardsuppose that in a closed economy GDP is equal to 22,000, taxes are equal to 7000, consumption is equal to 13,000, and government expenditures are equal to 4000. What is private saving?arrow_forward
- If Government Spending (G) is 200 million, Tax Revenue (T) is $260 million \$2 Consumption is $300 million, and GDP (Y) is 780 million. Public saving isarrow_forwardSuppose an economy’s steady-state investment rate I/Y is 30 percentwhen the corporate tax rate is zero. What happens to this investmentrate if the corporate tax rate rises to 20 percent? 30 percent?arrow_forward120 100 80 60 40 20 45° 20 40 60 80 100 120 Income (Billions) Refer to the above figure. If the relevant saving schedule were constructed: 1) its slope would be 1/2. 2) it would slope downward and to the right. 3) saving would be minus $20 billion at the zero level of income. 4) aggregate saving would be $60 at the $60 billion level of income. Consumption (Billions)arrow_forward
- If disposable income is $800 billion when the average propensity to consume is 0.8, it can be concluded that saving isarrow_forwardAssume that total expenditure E comprises the sum of government consumption, G, household consumption, C, and investment, I. Assume a closed macroeconomic system, so that income equals expenditure Y=E. If we define household saving, SH, as SH=Y-T-C, where the cunsumption function is a fixed proportion of disposable income, C=c(Y-T), which of the following will be true? a. Higher government spending alongside unchanged taxation will lead to higher investment and higher household saving b. Higher government spending alongside unchanged taxation will have no effect on household saving or investment c. Higher government spending alongside unchanged taxation will lead to higher household saving d. Higher government spending alongside unchanged taxation will lead to lower household savingarrow_forwardPlease answer only the (d) and (e) questions Thankyouarrow_forward
- karrow_forwardSuppose that the production function for an economy is given by Y = K1/4L3/4. The depreciation rate is 4%, the saving rate is 12%, Explain how the economy goes from one steady state to another.arrow_forwardSuppose real GDP is $5,042 billion, taxes collected by the government are $534 billion, government spending is $846 billion, and consumption spending is $3,461 billion. What is the value of public saving? Enter a whole number with no dollar sign and please do not include the word billion. If appropriate, please enter a negative (-) sign.arrow_forward
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