c = 400 + .60yd I = 200 Ytarget = 1875 a. calculate equilibrium disposable income for the one and two sector models b. calcualte the multipler c. what levels of government spending would be necessary to achieve the target level of income?

c = 400 + .60yd I = 200 Ytarget = 1875 a. calculate equilibrium disposable income for the one and two sector models b. calcualte the multipler c. what levels of government spending would be necessary to achieve the target level of income?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

ChapterD: The Expenditure-output Model

Section: Chapter Questions

Problem 24CTQ: Exercise D24 Compare two policies: a tax cut on income or an increase in government spending on...

See similar textbooks

Related questions

Q: C = 85 + 0.5Yd, I = 85, G = 60 and T = 40 + 0.25Y Solve for the eulibrium level of income and…

A: Formula for equilibrium level of income, Y = C + I + G

Q: Given the following consumption function, C = 400 + 0.75YD, where C= consumption expenditure, YD =…

A: GDP: GDP or gross domestic product is the final value of all the goods and services that are…

Q: In the national-income model Y = C+I+ Go C = a + B(1- t) Y I = I, + 8Y assume that a > 0 and B, 6, t…

Q: Country X has following data: C = 20 + 0.8Y4, I = 30, G = 40, T, = 20, T, = 15, X = 60, M = 20 +…

A: Here we calculate the following terms by using the given function and conclude the solution so the…

Q: Assume that X=375, M-500, I-800 and C-1,000 +0.8Yd, G-1200, and T- 800, where Yd is disposable…

A: here we calculate the equilibrium level of output by using those term which are as follow-

Q: Problem 1 Given the following for a closed economy I=3400 planned investment G=4000 Government…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Consider the following numerical example of the simple Keynesian model with no government spending,…

A: Here , We consider a simple Keynesian Model with no government spending , taxes or foreign sector:…

Q: be umbria, one witH high tax rate and one with a low tax rate. No suppose that government spending…

A: High marginal tax rates can deter work, saving, investment, and development, while explicit duty…

Q: se the data below to answer the question Autonomous consumption = 10 Autonomous investment = 5…

A: Y = C + I + G+NX Where C = a+bY0

Q: Q2. From the given three sector-model find out C = 25 + 6Y2 .1 = 16, G 14 i. National income ii.…

A: C=25+6Y0.5 I=16 G=14

Q: (c) Consider the following macroeconomic model Y = C + 1+ Go C = 40 + 0.8Y 1 = 0.1Y b(i) (ii) hand…

A: (i) Degrees of freedom Degrees of freedom are a statistical term that refers to the number of…

Q: Problem. Suppose the structural model of an economy is given C 100+0.75 Y %3D 200 %3D G = T=100 %3D…

A: Here we can find the equilibrium level of income by using these terms which are as follows

Q: Consumption function: C=500+0.8Yd , net tax: T=500, government spending: G=500, investment: I=1200,…

A: AE = C + I + G + X - M In equilibrium, Y = AE.

Q: If someone passes 1 trillion Infrastructure Bill,Graphical show the projected effect of this policy…

A: IS-MP model: It refers to a model under which the interest rate and output will be determined in the…

Q: Consider a hypothetical economy where: • C(Ya) = 12 + 0.75 × (Y – T) • I(r) = 124 – 1 xr • G= 120 •…

A: Investment savings curve depicts a relation between the real income Y and the rate of interest r.…

Q: 15. If government's spending increases by 60 and marginal propensity to consume is 0.8, how will the…

A: Given information: Government spending increases by 60 i.e., Change in government spending = 60 and…

Q: Use the following information to solve the question: Total income = 40 000 Autonomous consumption =…

A: Given: Total income(Y)=40000 Autonomous consumption(a)=10000 c (MPC)=0.7 Tax rate(T)=0.35 To find:…

Q: c. National-Income model: Closed economy i. Aggregate expenditure: AE = C +I + G Note: Exogenous…

A: Natinal income is the total factor in ome earned by the country's normal residents in an accounting…

Q: Y = C + 1 + G + (X – Z) C = Co + bY I = lo + aY G = Go Z = Z. X = Xo In the national income model…

A: The economies around the world work because of the aggregate spending which various entities in each…

Q: Potential 450 GDP C+1+G+(X-IM) F E T 4,000 5,000 6,000 Real GDP (billions of dollars per year) In…

A: Answer to the question is as follows :

Q: The economy is in a recession The government enacts a policy to increase the real GDP by $10 bilion.…

A: Recession refers to a period in which economic activity is reduced. The government has to increase…

Q: C=300+0.50(Y-T)

A: IS curve: It refers to that curve which shows the satisfaction of the consumer of the different…

Q: In the circular flow of income and expenditure model... O A. the level of Income for factors of…

A: The simplest form of Circular Flow Model consists two sectors, i.e., household sector and firm…

Q: Quèstion 14 Refer to the Table for a private closed economy and match the correct answer. Domesti c…

A: Please find the attached answer of both the questions below-

Q: iven the following closed economy model: C = .8Yd + 800 I = 1000 G = 6000 T = .25Y + 100 Yf =…

A: Given:C=0.8t=0.25

Q: Suppose structural model of an economy is given as follows. C = 100 + 0.80Yd Yd =Y-T I = 100 G = 100…

A: (a) Expenditure multiplier is given by the formula ∆Y∆G=11-MPC, where, MPC is the marginal…

Q: You are told that taxes in this economy are equal to 100. What is the value of autonomous…

A: Autonomous consumption: Autonomous consumption is defined as consumption spending that occurs when…

Q: Using the information below for a four sector economy, calculate the following: = 400 + 0.65 Yd =…

A: Note:- Since we can only answer up to three subparts, we'll answer the first three. Please repost…

Q: If consumption is C=100+0.75Yd Taxes is T=50+0.5Y Export is X=200 Import is M=50+0.25Y…

A: Given consumption is C=100+0.75Yd Taxes is T=50+0.5Y Export is X=200 Import is M=50+0.25Y Government…

Q: The equilibrium levels of income 1Consumptiion C, disposable in come Yo and taxation T for a three-…

A: Answer to the question is as follows :

Q: Use the following to answer questions Item In trillions of Rs. GDP 17.6 Govermment purchases 1.9…

A: Gross domestic product (GDP) is the standard measure of the value added created through the…

Q: assume the following economy autonomous consumption =£3m marginal propensity to consume= 0.8…

A: Given autonomous consumption(Ca) =£3m marginal propensity to consume(c) = 0.8 business…

Q: 2. Consumption function: C=500+0.8Yd, net tax: T=500, governmentspending: G=500, investment: I=1200,…

A: In equilibrium, Y = C + I + G + X - M Saving (S) = Y - C Multiplier = 1 / (1 - MPC) Increase in Y =…

Q: following equations that describe an open economy with government, where governmer ual $0. C = 320 +…

A: *Answer:

Q: Suppose a simple economy has no government, so that the aggregate expenditure function is: AE = C…

A: AE = C + 1 + X - 1M c = 160 + by Consumption schedule passes through (0,160) and (40, 180) Slope…

Q: Course: Macroeconomic - IS-LM Model Prove mathematically the following: Given an increase in the…

A: Given: IS-LM Model There is increase in the proportional tax on income(t).

Q: Consider an economy described by the following equations: C = a + b(Y – T) | = cY – di + e Md = fY –…

A: Answer;

Q: Suppose an economy is described by the following equations: Y = C + I + G + X – M C = 14 + 0.60Yd…

Q: A. Assume that the four-sector model is at play. C+I+G. All expenditures are autonomous. Given: C-…

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Consider the following model of an economy operating with fixed wages, prices and interest rates and…

A: PART 1: NOTE: Since we only answer up to 3 sub parts, we will answer the first 3.please resubmit the…

Q: To assume that the structural model of an economy is given below : C = 100+0.75 Ya %D | = 200 %3D G…

Q: 2.2 Consider the following functions for a model economy: Consumption: C-C, +c (Y-T) Investment:…

A: Macroeconomics refers to the branch of economics that deals with the performance, structure,…

Q: 20. In a closed economy without investment and government spending, C = 1000 +.5YD, and taxes T=50,…

A: Given : In a closed economy with no investment and government spending- Consumption = 1000+0.5YD…

Q: C = 600+ 0.8Yd, Yd=Y-T, Tg = 100, l= 200, R = 50, G = 350, X = 250 and M = 200+ 0.1Y. a. Calculate…

A: As per the guidelines we are allowed to solve the first three subparts only. Please post the…

Q: Import is M=50+0.25Y Government spending is G=150

A: Given : C=100+0.75Yd Taxes is T=50+0.5Y Export is X=200 Import is M=50+0.25Y Government spending is…

Question

c = 400 + .60yd

I = 200

Ytarget = 1875

a. calculate equilibrium disposable income for the one and two sector models

b. calcualte the multipler

c. what levels of government spending would be necessary to achieve the target level of income?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

What is the relative importance of government spending (G) in aggreagte demand and some factors that affect it?
How do i trace this scenario on the circlar flow model, firms inventories unexpectedely rise?
Exercise D24 Compare two policies: a tax cut on income or an increase in government spending on roads and bridges. What are both the short-term and longâ€”term impacts of such policies on the economy?
Agricultural price supports result in governments holding large inventories of agricultural products. Why do you think the government cannot simply give the products away to poor people?
Exercise D25 What role does government play in stabilizing the economy and what are the tradeoffs that must be considered?
1. What relationship does the income expenditure model represent? Why is it used?
6 T/F/U. To counterbalance a decrease in investment during a recession, governments offer tax credits to increase investment. Draw and label a figure showing why this is or isn't the case.
levels of in come The equilibrium levels of income Y consumptiion C, disposable income Yo and a three- Sector macroeconomic model Satis.fy the Structural equatione taxation T, for %3D C + In t Go C=atbld (ocbel, a>o) Y-T TE tY + To o >o) ☺ Express Ax=d Ü Using Cramer's rule, find the equilibrium levels of consumption (^), dis poseble in come CYo and Taxation (Tr) this System ln the form
3:35 PM O ll al a 59 % f H.W2.pdf Sx. The mantaly conumpthie Values for rice are Use below:- July Sept. Oct. Nov. June Aug. 28.65 7.85 13.45 21.60 24.30 14.70 Cm Cm Cm Cm Cm Determin the seasonal The consumptive use, The average montaly Consumptive use and average dzily comsumptive use, the beak monthly consumptive use.
Early during the COVID-19 pandemic, the government used multiple stimulus packages to increase government spending. 3. Using the Z-Y, NX-Y, IS-LM, UIP combined graph on the next page, what should be happening as a result? Show the shifts on the graph itself. NN Z Z NN Y=Z Z c0- if f UI i pvt L M c1T+I+G+NX i10 y 45° if f if NK N Y Y f 0 Y X Y 0 Y 0 Y 20 NX N X E 0 E Y NX Fiscal stimulus
The table below is the multiplier matrix of the 4 sector economic model. Exogenous Variables G* T* AND C T Even. YD M B AS S A 1.163 0.817 0.311 1.73 0.311 0.311 - 0.311 0.222 I* 1.163 0.817 0.311 1.73 0.311 0.311 - 0.311 0.222 1.163 0.875 0.311 1.73 0.311 -0.655 -0.311 0.222 - 1.094 -0.815 0.781 -1.875 -0.219 0.781 0.219 - 0.563 X* 1.163 0.815 0.311 1.25 0.311 0.311 0.547 0.222 a. Calculate the change of each endogenous variable value of the effect of AG* = 160 M* - 1.163 - 1.393 - 0.311 - 1.25 0.655 - 0.311 - 0.547 - 0.222 b. Calculate the net change in each value of the endogenous variable as a result of the simultaneous change, AX* = 200 and AM* = -150 c. AT* = 250; By how much does the government need to change G* so that the net effect of these 2 shocks (AT* = -250 and AG* which you calculated) so that AB = 0? d. Calculate the net change in each value of the endogenous variable as a result of the 2 shocks occurring in (c).
Do answer and explain plz.