urgent i will10 upvites Consider the hypothetical country of Pelee. Suppose that national income in Pelee is $30 billion, households pay $10 billion intaxes, household consumption is equal to $18 billion, and the marginal propensity to consume (MPC) is 0.8.On the following graph, use the blue line (circle symbol) to plot the economy's consumption function.CONSUMPTION (Billions of dollars)504598815105051025 30 354.0DISPOSABLE INCOME (Billions of dollars)159O $26.8 billion$25.2 billionO $21.2 billion.O $24.4 billion45 50Consumption Function?Suppose now that Pelee's national income increases to $34 billion. Assuming the amount paid in taxes is fixed at $10 billion andthat MPC = 0.8, what is the new amount of household consumption?

In the given question we are given with,national income(Y)= $30 billiontax(t)= $10 billion,…

Consider the hypothetical country of Pelee. Suppose that national income in Pelee is $30 billion, households pay $10 billion in taxes, household consumption is equal to $18 billion, and the marginal propensity to consume (MPC) is 0.8. On the following graph, use the blue line (circle symbol) to plot the economy's consumption function. CONSUMPTION (Billions of dollars) R 50 45 9 40 B 25 15 10 5 0 0 5 10 15 20 30 35 40 45 DISPOSABLE INCOME (Billions of dollars) 50 Consumption Function Suppose now that Pelee's national income increases to $34 billion. Assuming the amount paid in taxes is fixed at $10 billion and that MPC=0.8, what is the new amount of household consumption? O $26.8 billion $25.2 billion $21.2 billion. O $24.4 billion

Consider the hypothetical country of Pelee. Suppose that national income in Pelee is $30 billion, households pay $10 billion in taxes, household consumption is equal to $18 billion, and the marginal propensity to consume (MPC) is 0.8. On the following graph, use the blue line (circle symbol) to plot the economy's consumption function. CONSUMPTION (Billions of dollars) R 50 45 9 40 B 25 15 10 5 0 0 5 10 15 20 30 35 40 45 DISPOSABLE INCOME (Billions of dollars) 50 Consumption Function Suppose now that Pelee's national income increases to $34 billion. Assuming the amount paid in taxes is fixed at $10 billion and that MPC=0.8, what is the new amount of household consumption? O $26.8 billion $25.2 billion $21.2 billion. O $24.4 billion

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

urgent i will10 upvites

Consider the hypothetical country of Pelee. Suppose that national income in Pelee is $30 billion, households pay $10 billion in
taxes, household consumption is equal to $18 billion, and the marginal propensity to consume (MPC) is 0.8.
On the following graph, use the blue line (circle symbol) to plot the economy's consumption function.
CONSUMPTION (Billions of dollars)
50
45
9
88
15
10
5
0
5
10
25 30 35
4.0
DISPOSABLE INCOME (Billions of dollars)
15
9
O $26.8 billion
$25.2 billion
O $21.2 billion.
O $24.4 billion
45 50
Consumption Function
?
Suppose now that Pelee's national income increases to $34 billion. Assuming the amount paid in taxes is fixed at $10 billion and
that MPC = 0.8, what is the new amount of household consumption?

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