Economics: Principles & Policy
14th Edition
ISBN: 9781337696326
Author: William J. Baumol; Alan S. Blinder; John L. Solow
Publisher: Cengage Learning
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Question
Chapter 25, Problem 1TY
To determine
Determine the equilibrium level of
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Potential
GDP|
' 45°
C+1+(X-IM)
4,800
B
3,200
3,000 4,000 5,000
2. Use the graph above to answer the following questions:
a. Calculate the MPC:
b. What is the equilibrium value of GDP?_
Real Expenditure
(billions of dollars per year)
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.
GDP
Consumption expenditures
$600
Exports
$75
Government purchases of goods and services
$200
Construction of new homes and apartments
$100
Sales of existing homes and apartments
$200
Imports
$100
Beginning-of-year inventory stocks
$100
End-of-year inventory stocks
$150
Business fixed investment
$100
Government payments to retirees
$100
Household purchases of durable goods
$150
Consumption expenditures: $
Investment expenditures: $
Government Purchases: $ Net Exports: $ GDP: $
Use the following information to complete the calculations.
C = 15235 + 0.67Y
I = 8777
G = 3425
NX = -551
What is the value of autonomous expenditure (AE)? Round your answer to the nearest dollar.
AE: $
Calculate the equilibrium level of GDP. Round your answer to the nearest dollar.
GDP: $
Chapter 25 Solutions
Economics: Principles & Policy
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