6. An economy shows the following features :Consumption, C= 50 + 0.9 (Y – T)Tax Revenue, T= 100Investment, I= 150 – 5i%3DGovernment expenditure, G= 100Money demand, L = 0.2 y – 10iMReal money suPply=100PExports, X= 20Imports, M= 10+ 0.1 Ywhere Y= income, irate of interest figures in Rs. crores.%3D(a) Obtain the IS and IM equations of the economy(b) Find out equilibrium income and rate of interest atom(c) Find the balance of trade

Y = C+I+G+NX Y = National income or GDP C= Consumption expenditure I = Investment expenditure G=…

6. An economy shows the following features : Consumption, C= 50 + 0.9 (Y – T) Tax Revenue, T= 100 Investment, I= 150 – 5i Government expenditure, G = 100 Money demand, L = 0.2 y – 10i %3D M Real money supPply =100 Exports, X= 20 Imports, M= 10+ 0.1 Y where Y= income, i = rate of interest figures in Rs. crores. (a) Obtain the IS and IM equations of the economy (b) Find out equilibrium income and rate of interest atom (c) Find the balance of trade

6. An economy shows the following features : Consumption, C= 50 + 0.9 (Y – T) Tax Revenue, T= 100 Investment, I= 150 – 5i Government expenditure, G = 100 Money demand, L = 0.2 y – 10i %3D M Real money supPply =100 Exports, X= 20 Imports, M= 10+ 0.1 Y where Y= income, i = rate of interest figures in Rs. crores. (a) Obtain the IS and IM equations of the economy (b) Find out equilibrium income and rate of interest atom (c) Find the balance of trade

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question 1. Please answer the following questions related to Gross domestic product (GDP). a. There are at least three ways to define or measure Gross Domestic Product (GDP), as discussed in our class. Please briefly describe these three definitions of GDP. b. Assume that total output in an economy consists of 400 apples and 600 oranges and that apples cost $1 each and oranges cost $0.50 each. The labour cost of the production is $50. In this case, what is the value of GDP?
4 (a Your task is to calculate the equilibrium National Income (Y) and the interest rate (i)based on the figures above: (6 points) Y == and i= 4 (b Describe how large the state's tax revenues are and calculate the state budget balance(Sb), further you should calculate country's current account (NX): (9 points) T = Sb= NX =
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2. Suppose we have the following data to study if a country's per capita income (measured in thousands of dollars) is a function of its R&D spending (measured as a percentage of GDP). ( country 1 2 3 4 xi yi 1 4 2 6 3 7 4 10 (1) Calculate beta hats with OLS. (2) Calculate R2 and adjusted R².
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17. Suppose that business firms spend $700 million on new capital equipment this this $700 million, $500 million was spent on domestically produced capital and $200 million was spent on foreign-produced capital. All else being equal, these transactions contribute year. Of to GDP. A) $700 million В) $0 C) $500 million D) $200 million
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