Economics (7th Edition) (What's New in Economics)
7th Edition
ISBN: 9780134738321
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Question
Chapter 23, Problem 23.2.1RQ
To determine
To determine: The importance of the factors in the aggregate expenditure model.
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Students have asked these similar questions
Calculate the four components of aggregate expenditure and GDP for the following economy using data from the table below.
Instructions: Enter your responses as whole numbers. If you are entering any negative numbers, be sure to include a negative (-) sign
in front of those numbers.
Consumption expenditures
Exports
Government purchases of goods and services
Construction of new homes and apartments
Sales of existing homes and apartments
Imports
GDP
Beginning-of-year inventory stocks
End-of-year inventory stocks
Business fixed investment
Government payments to retirees
Household purchases of durable goods
Consumption expenditures: $
Investment expenditures: $
Government Purchases: $
Net Exports: $
GDP: $
$800
$50
$200
$200
$200
$125
$100
$100
$100
$100
$150
There are four spending groups that buy GDP: consumption, investment, government purchases, and net exports. Which group is the largest? Which one fluctuates the most?
You purchase a Tesla Model 3. What is the impact to the different components of the U.S. GDP and the overall impact to net GDP for the U.S.?
Chapter 23 Solutions
Economics (7th Edition) (What's New in Economics)
Ch. 23.A - Prob. 1RQCh. 23.A - Prob. 2RQCh. 23.A - Prob. 3RQCh. 23.A - Prob. 4RQCh. 23 - Prob. 23.1.1RQCh. 23 - Prob. 23.1.2RQCh. 23 - Prob. 23.1.3RQCh. 23 - Prob. 23.1.4PACh. 23 - Prob. 23.1.5PACh. 23 - Prob. 23.1.6PA
Ch. 23 - Prob. 23.1.7PACh. 23 - Prob. 23.1.8PACh. 23 - Prob. 23.1.9PACh. 23 - Prob. 23.2.1RQCh. 23 - Prob. 23.2.2RQCh. 23 - Prob. 23.2.3RQCh. 23 - Prob. 23.2.4RQCh. 23 - Prob. 23.2.5RQCh. 23 - Prob. 23.2.6PACh. 23 - Prob. 23.2.7PACh. 23 - Prob. 23.2.8PACh. 23 - Prob. 23.2.9PACh. 23 - Prob. 23.2.10PACh. 23 - Prob. 23.2.11PACh. 23 - Prob. 23.2.12PACh. 23 - Prob. 23.2.13PACh. 23 - Prob. 23.2.14PACh. 23 - Prob. 23.2.15PACh. 23 - Prob. 23.3.1RQCh. 23 - Prob. 23.3.2RQCh. 23 - Prob. 23.3.3RQCh. 23 - Prob. 23.3.4RQCh. 23 - Prob. 23.3.5RQCh. 23 - Prob. 23.3.6PACh. 23 - Prob. 23.3.7PACh. 23 - Prob. 23.3.8PACh. 23 - Prob. 23.3.9PACh. 23 - Prob. 23.3.10PACh. 23 - Prob. 23.3.12PACh. 23 - Prob. 23.4.1RQCh. 23 - Prob. 23.4.2RQCh. 23 - Prob. 23.4.3RQCh. 23 - Prob. 23.4.4PACh. 23 - Prob. 23.4.5PACh. 23 - Prob. 23.4.6PACh. 23 - Prob. 23.4.7PACh. 23 - Prob. 23.4.8PACh. 23 - Prob. 23.4.9PACh. 23 - Prob. 23.4.10PACh. 23 - Prob. 23.4.11PACh. 23 - Prob. 23.4.12PACh. 23 - Prob. 23.4.13PACh. 23 - Prob. 23.4.14PACh. 23 - Prob. 23.5.1RQCh. 23 - Prob. 23.5.2RQCh. 23 - Prob. 23.5.3RQCh. 23 - Prob. 23.5.4PACh. 23 - Prob. 23.5.5PACh. 23 - Prob. 23.5.6PACh. 23 - Prob. 23.1RDECh. 23 - Prob. 23.2CTECh. 23 - Prob. 23.3CTE
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Similar questions
- what is The Aggregate Expenditure Modelarrow_forwardare savings and spending on imports included in aggregate expenditure?arrow_forwardCalculate the four components of aggregate expenditure and GDP for the following economy using data from the table below.Instructions: Enter your responses as whole numbers. If you are entering any negative numbers, be sure to include a negative (-) sign in front of those numbers. GDP Consumption expenditures $550 Exports $100 Government purchases of goods and services $200 Construction of new homes and apartments $200 Sales of existing homes and apartments $200 Imports $50 Beginning-of-year inventory stocks $100 End-of-year inventory stocks $50 Business fixed investment $100 Government payments to retirees $100 Household purchases of durable goods $150 Consumption expenditures: $ Investment expenditures: $ Government Purchases: $ Net Exports: $ GDP: $arrow_forward
- What is the effect on aggregate expenditure if the values of exports exceeds the value of imports in a countryarrow_forwardBased on The Aggregate Expenditure Model, what affects the level of consumption (five factors); and what affects the level of investment (four factors)?arrow_forwardRefer to the data for 2019 below to answer the following questions: The Equivalence of Expenditure and Income (in Billions of Dollars) Expenditure C: Consumer goods and services 1: Investment in plants, equipment, and inventory G: Government goods and services X: Exports M: Imports GDP: Total value of output % b. Corporate profits? % ▬ 1 $14,561 Q Search 3,744 3,754 2,504 Instructions: Enter your responses as a percentage rounded to one decimal place. What share of U.S. total income in 2019 consisted of a. Wages and salaries? (3,136) $21,427 Wages and salaries Corporate profits Proprietors' income AD i $11,434 2,075 1,658 778 645 1,494 3,463 (120) $21,427 Oarrow_forward
- Based on the assumptions of the aggregate expenditure model, the equilibrium level of aggregate expenditure in this economy is equal A) Actual aggregate income and output (GDP). B) potential income and output (full employment GDP) C) less than the aggregate income and output (GDP) D) more than the aggregate income and output (GDP)arrow_forwardThe following expenditure equation is utilised to measure the economy: GDP = C + I + G + (X-M) Analyse each of the situations below and state which expenditures (or parts of the expenditures) would be counted under which of the four segments of the GDP expenditure equation, ie C, I, G or (X-M). a. The purchase of Australian made furniture by a business for use in its cafe. b. The purchase of foreign made furniture by a business for use in its café. c. The purchase of wood by a business to manufacture furniture which will then be sold to Australian and foreign customers. d. The purchase of 100 shares in ANZ Bank through a stockbroker. e. Purchase of a 10-year-old foreign-made second-hand car from a Car Sales business in Parramatta, NSW. f. A pension paid by the Australian Government to an old age pensioner. g. You babysit for your nieces and nephews so your sister and her husband can go out for dinner.arrow_forwardWhat is the impact of spending changes on GDP?arrow_forward
- When a U.S. consumer buys Canadian maple syrup at the grocery store, this purchase is:A) an importB) an exportC) gross domestic productD) a transfer payment. Below is economic data for Germany for 2016 (measured in billions of current euros). What was total spending? Consumption 1,649.79 Investment 636.42 Government spending 620.01 Exports 1,442.41 Imports 1,211.64 A) 2,675B) 4,348C) 2,906D) 3,137 Please ans both questions and you will get thumbs up.arrow_forwardIf a Japanese tourist drinks German beer in a hotel in New York City, how will the U.S. GDP be affected? Give your answer using both the expenditure approach and the output approach.arrow_forwardWhat are the equations for the consumption, net exports, and aggregate expenditures functions?arrow_forward
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