13. Let's assume that consumption depends on disposable income, and investment depends on the interest rate and output. Government spending is exogenously determined. Consider that there is an open market sale of bonds by the central bank. a. In an IS-LM diagram, show the effect of the open market sale of bonds on output and the interest rate. Explain clearly what causes the curve(s) to shift. b. How will the open market sale of bonds affect consumption, private saving, and investment in equilibrium? Explain clearly what causes changes in those macroeconomic variables. c. Suppose the federal government wants to maintain output at the initial level. What must the federal government do in response to the central bank's sale of bonds to restore output? Show the effect on output and the interest rate using the IS-LM diagram. What effect will this policy have on private saving?

Q: did you get 0.2Y?

A: The aggregate expenditure is the sum total of consumption, investment, government expenditures.

Q: The table shows a private open economy. All figures are in billions of dollars. Real GDP C+ lg Net…

A: The real GDP refers to the total goods and services produced in an economy in a given fiscal…

Q: GST was first introduced in which country ?

A: GST was introduced in many countries to reduce the tax evasion.

Q: definition of products, goods and services

A: TO understand the definition of these terms, we need to understand that goods and products are used…

Q: Why are families so important to the American economy?

A: Rising monetary disparity in the United States and all over the planet is broadly considered a…

Q: What are some common examples of expenses?

A: To generate revenue, the business organizes many activities. The cost of doing these activities are…

Q: How is the Purchasing power important?

A: Answer - Purchasing Power - Purchasing power is overall buying capacity of country which is…

Q: What makes housing and housing markets unique compared to other goods?

A: The Housing Market refers to the supply and demand for houses in a particular country or region in…

Q: What are the two kinds of Indian budget?

A: Introduction - The French word "bougettee," from which the English word "budget" is derived, refers…

Q: can u solve d and e

A: Unemployment is an expression alluding to people who are employable and effectively looking for a…

Q: what is the most important concept in satisfying needs and wants

A: A need is anything which is a basic necessity and is required to live. On the other hand, wants are…

Tax Incidence Analysis

Tax incidence analysis is a kind of economic analysis. It helps to understand the division of tax burden between stakeholders. Tax incidence also relates to the price elasticity of demand and supply. The producers and consumers may valuate their tax burden with the help of tax incidence analysis. It also helps to calculate the burden of a new tax. It is the effect of a particular tax and analysis of tax occurrence in the economy.