Macroeconomics, Student Value Edition Plus MyLab Economics with Pearson eText -- Access Card Package (7th Edition)
7th Edition
ISBN: 9780134472669
Author: Blanchard
Publisher: PEARSON
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Question
Chapter 3, Problem 10QAP
a)
To determine
To find:Amount of dollars in 3 percentage points of $15000 billion.
b)
To determine
To find:Changes in government spending to prevent fall in output.
c)
To determine
To find:Changes in tax to prevent decline in output.
d)
To determine
To find:Amount of Increase in government spending and taxes to prevent decline in output.
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Students have asked these similar questions
Suppose actual real GDP is $7.91 trillion, potential real GDP is $13.33 trillion, the marginal propensity to consume is 0.68, and that the government has a balanced budget. If we ignore price effects, by how many trillions of dollars should the government change its spending to fix the gap while keeping the federal budget balanced? (Round this to two digits after the decimal and enter this value as either a positive value or a negative value without the dollar sign.)
Please answer the question below:
If the current real GDP is P700 billion, which of the following policies would bring the economy to potential output?
a. increase government spending by P25 billion
b. increase government spending by P100 billion
c. increase government spending by P20 billion
d. decrease government spending by P100 billion
If current real GDP is P700 billion, which of the following policies would bring the economy to potential output?
a. decrease taxes by P100 billion
b. increase taxes by P100 billion
c. decrease taxes by P25 billion
d. increase taxes by P25 billion
* the attached photo is just connected to the question *
What is the eventual effect on real GDP if the government increases its purchases of goods and services by $75,000? Assume the marginal propensity to consume (MPC) is 0.75.
$
What is the eventual effect on real GDP if the government, instead of changing its spending, increases transfers by $75,000? Assume the MPC has not changed.
$
An increase in government transfers or taxes, as opposed to an increase in government purchases of goods and services, will result in
an identical eventual effect on real GDP.
no change to real GDP.
a larger eventual effect on real GDP.
a smaller eventual effect on real GDP.
Chapter 3 Solutions
Macroeconomics, Student Value Edition Plus MyLab Economics with Pearson eText -- Access Card Package (7th Edition)
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