Consider the following two equations, which describe the long-run investment and national savings equations for an economy. I = 0.03Y – 137i + 243 NS = 0.07Y + 363i – 5, 189 Suppose potential GDP is equal to $135,000. The real interest rate that will lead to equilibrium in the financial capital market is i* = %? Express your answer in percentage terms, rounding to one decimal place. Do not include the %-sign in your answer. For example: if i = 0.0199, type: 2.0 Suppose you observe Investment = $4, 318. You would conclude that: • i is i". Choose from: greater than, less than, equal to • the demand for financial capital is the supply. Choose from: greater than, less than, equal to, ambiguously different from • to restore the equilibrium, the real interest rate must Choose from: rise, fall, remain constant, change ambiguously Suppose tax revenues collected by the government falls. This will cause equilibrium Investment levels to Choose from: increase, decrease, remain unchanged

Consider the following two equations, which describe the long-run investment and national savings equations for an economy. I = 0.03Y – 137i + 243 NS = 0.07Y + 363i – 5, 189 Suppose potential GDP is equal to $135,000. The real interest rate that will lead to equilibrium in the financial capital market is i* = %? Express your answer in percentage terms, rounding to one decimal place. Do not include the %-sign in your answer. For example: if i = 0.0199, type: 2.0 Suppose you observe Investment = $4, 318. You would conclude that: • i is i". Choose from: greater than, less than, equal to • the demand for financial capital is the supply. Choose from: greater than, less than, equal to, ambiguously different from • to restore the equilibrium, the real interest rate must Choose from: rise, fall, remain constant, change ambiguously Suppose tax revenues collected by the government falls. This will cause equilibrium Investment levels to Choose from: increase, decrease, remain unchanged

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

what Is Forecasting and the Business Cycle
What you understand by Business Cycles.
A luxury is a non-essential enjoyment. Food, housing, and water are essential for most humans. Many Americans would install electricity and indoor plumbing. Many people now consider Internet connection essential. Is it a necessity? What about folks without Internet access or who don't utilize it? How may the requirement of Internet connectivity effect e-commerce growth?
Is the people in a country more important to save than its economy?
What can you suggest to the government, the private sector and the civil society to further improve their services?
What are the measures that can be used to improve income generation in Ghana
Globalization had brought different effects to the society. It had changed that world and how the world processes. Different states join together in creating a better world for humanity. Different businesses establish parts of their business in different parts of the planet in order to provide work for the underdeveloped or developing nations. Most of these nations profit from the globalization processes of the world because this is the way in which they acquire profit. Having a Multi-national Corporation (MNC) invest in one of those nations provides good opportunity not only for the government but also the people. Among the entities involved in the process of globalization, the people are said to profit most for the reason that they are given opportunities and jobs for their family. However in another perspective, the MNCs could be seen as the most profitable entity in the aspect of globalization. It is known to many that the labor pay for the people of the developed and…
What is the effect of a tax on interest income?
Personal income includes income received in the form of transfer payments True False
why should young people become advocates and active citizens?
why Gross domestic savings (% of GDP) impact to Secondary education in a country ?
Meation 5 Developing country