Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN: 9781337091985
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 18, Problem 10QR
To determine
Adverse effect of tax incentives to increase savings.
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Why is savings equal to investment
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Chapter 18 Solutions
Brief Principles of Macroeconomics (MindTap Course List)
Ch. 18.1 - Prob. 1QQCh. 18.2 - Prob. 2QQCh. 18.3 - Prob. 3QQCh. 18.4 - Prob. 4QQCh. 18.5 - Prob. 5QQCh. 18.6 - Prob. 6QQCh. 18 - Prob. 1CQQCh. 18 - Prob. 2CQQCh. 18 - Prob. 3CQQCh. 18 - Prob. 4CQQ
Ch. 18 - Prob. 5CQQCh. 18 - Prob. 6CQQCh. 18 - Prob. 1QRCh. 18 - Prob. 2QRCh. 18 - Prob. 3QRCh. 18 - Prob. 4QRCh. 18 - Prob. 5QRCh. 18 - Prob. 6QRCh. 18 - Prob. 7QRCh. 18 - Prob. 8QRCh. 18 - Prob. 9QRCh. 18 - Prob. 10QRCh. 18 - Prob. 1PACh. 18 - Prob. 2PACh. 18 - Prob. 3PACh. 18 - Prob. 4PACh. 18 - Prob. 5PACh. 18 - Prob. 6PACh. 18 - Prob. 7PACh. 18 - Prob. 8PA
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- What is the impact of a change in the savings rate on the output?arrow_forwardHow do the sophisticated financial systems of modern economies affect the relationship between saving and investment?arrow_forwardWhy do we use the present value of an asset or investment as basis for its value?arrow_forward
- The typical savings supply curve has a positive slope. If a nation's saving supply curve is perfectly vertical, what would that mean? People in this country save the same amount no matter what the interest rate is. People in this country are extremely sensitive to interest rates when deciding how much to save.arrow_forwardPlease explain the impact of a change in the savings rate on the output.arrow_forwardFinancial institutions have warned that increased life expectancy means that many people have not saved enough for their retirement. If true, what will the consumption path of these people look like as they reach their retirement years? Will this consumption path be smooth? And how will an increase in investment demand change the equilibrium interest and quantity of savings? Use a graph for the loanable funds market.arrow_forward
- Is it possible for total saving to fall when people become more thirfty?arrow_forwardSuppose people can consume the income they earn or save and invest it at rate ?. If we tax wealth at a rate greater than ?, how are people likely to adjust their rate of savings?arrow_forwardIf net personal taxes rise, what happens to private saving ? Public saving ?arrow_forward
- If the government wants to increase the amount of savings in the economy, how should it alter government spending? What effect will this action have on the interest rate in the economy?arrow_forwardWhy might an investor prefer to invest indirectly rather than directly?arrow_forwardHow does a decrease in the tax rate on income earned on saving affect saving, investment, the interest rate, and economic growth?arrow_forward
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