Find equilibrium GDP using the following macroeconomic model (the numbers, with the exception of the MPC, represent bilions of dolar C= 1,250 + 0.80Y 1= 1,250 Consumption function Planned investment function G = 2,000 Government spending function NX = - 500 Net export function Y= C+1+G+ NX Equilibrium condition The equilibrium level of GDP is $ billion. (Round your answer to the nearest billion dollars
Q: Consider the following information: MPC = 0.9 Autonomous Investment = R200 m Autonomous…
A: Marginal propensity to consume: It measures the proportion of the change in the consumption level…
Q: T = 20 + 0.2 × Y T R = 10 − 0.1 × Y where Y is national income. The basic consumption function is…
A:
Q: Consider a simple economy in which investment is constant and equal to $100 billion. There is no…
A: Since you have asked a question with multiple sub-parts, we will solve the first three sub-parts for…
Q: Given the following set of equations for an economy model: C = A+b YD I = I* - Ir T = T* + tY…
A: IS curve shows the negative relationship between income level and interest rate . Each and every…
Q: The consumption function for a closed economy with no government sector is given by the equation: C…
A: C = 200 + 0.8Y Note:- we have taken all the parts separately no parts are connected with each…
Q: QUESTION 12 A country is closed. It has no government sector, and its aggregate price levels and…
A: The equation Y = C + I + G + NX tells us that aggregate output (or aggregate income) is equal to…
Q: "If taxes and government spending are reduced by the same amount, there will be no effect on…
A: The multiplier for expenditures The expenditure multiplier, which depicts how changes in autonomous…
Q: Use the information in the table to answer the following questions. All numbers are in billions of…
A: Aggregate spending is the sum of consumption, investment, government spending and net exports in an…
Q: Given the following: C = 150 + 0.25Y4 = 150 + 0.25(Y – T) I = 300 G = 450 T = 250 Solve for the…
A: "In macroeconomics, closed economy-equilibrium will occur at a point where total output (Y) equates…
Q: Assume that GDP (Y) is 6,000. Consumption (C) is given by the equation C= 600+ 0.6(Y – T).…
A: National savings come from two sources the public sector and the private sector. The private sector…
Q: a. Calculate the missing values in the table below given that the Aggregate Consumption Function for…
A: In Keynesian macroeconomics theory, aggregate demand plays a very important role because in…
Q: Suppose that the level of income is $1000 and the tax rate is 0.1 %. Given this data, what is the…
A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: Suppose the United States economy is repre- sented by the following equations: Z = C +…
A: Here, given information is: Z = C + I + G C = 500 + 0.75YD T = 600 I = 300 G = 2000 YD = Y − T
Q: Consider the Savings-Investment model involving: The Savings function: S = S0+s1Y+s2r; and the…
A: Equilibrium occurs at a point where : AD = AS C + I = C + S Cancelling C from both sides we get ,…
Q: Which on is incorrect a) the level of autonomous consumption is determined by the non income…
A: The incorrect statement is: investment spending is the most stable component of aggregate spending…
Q: Y= AD on 45-degree line AD A C, + I(r) + G +X Note: AD = c, + c,(1 – t)Y + I(r) + G + X-mY 45°…
A: The equilibrium condition in an economy represents the situation where the optimum output is…
Q: Consider an economy in which autonomous consumption, planned autonomous investment, autonomous…
A: The GDP is $19000 and the MPC is 0.75. So, consumption will be: Consumption =GDP×MPCConsumption…
Q: Q.1.14 In the Keynesian model, what is the most important determinant of a household’s consumption?…
A: Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: Find equilibrium GDP using the following macroeconomic model (the numbers, with the exception of the…
A: The economy is at equilibrium when the aggregate supply is equal to aggregate demand. Equilibrium…
Q: Given the following set of equations for an economy model: Consumption expenditure Investment C =…
A: Y = C + I +G + M Y = (A* + b YD) + I* -lr + M Y = A* + b (Y - T* - tY ) + I* - lr + M* + mY Y = A*…
Q: Fill in the table below to answer the next five questions. Assume that l", G and NX are fixed.…
A: Real GDP Consumption Planned Investment Government expenditure Net export Aggregate Expenditure…
Q: Fill in the table below to answer the next five questions. Assume that l", G and NX are fixed.…
A: Gross Domestic Product (GDP) is the total value of all the goods and services produced inside the…
Q: Assume you have the following model of the expenditure sector:AD = C + I + G + NX C = Co + cYD YD =…
A: The responsiveness of expenditure due to a change in income is the expenditure multiplier. The…
Q: Assume a hypothetical closed economy. The National income identity expression for this economy is…
A: The national income is the total income earned by all the people of a country in a particular period…
Q: Consider an economy described by the following data C= $3.25 trillion = $1.3 trillion G = $3.5…
A: The IS curve is a downward sloping curve that is derived from the goods market equilibrium. It shows…
Q: Based on the economic data of a country presented in the following table, complete the table!…
A: The entire quantity of demand for all finished products and services generated in an economy is…
Q: Assume a simple closed economy without exports and imports. autonomous consumption expenditure is 50…
A: In the Keynesian theory when the price level in the economy is assumed to be fixed then equilibrium…
Q: Consider the following model of an economy with no international trade, and in which the price level…
A: The consumption of the economy, the planned investment and the government expenditure along with the…
Q: The total expenditure in Macroland begins with these initial levels (in trillions of dollars):…
A: Multiplier = 1 / [1 - MPC] Decline in GDP = Decline in investment * Multiplier
Q: Consider an economy described by the following data: C= $3.25 trillion T = $1.3 trillion G= $3.5…
A: Introduction: Consumption function - In economics, the link between consumer spending and the…
Q: ind the equilibrium level of GDP (income or V) demanded in an economy in which investment (1) is…
A: The economics as a study is based upon the idea that the economies, or the societies around the…
Q: The consumption function for a closed economy with no government sector is given by the equation: C…
A: Disclaimer :- As you posted multipart question we are supposed to solve the first 3 only as per the…
Q: The following table provides data for output (real GDP) and saving. a. Fill in the missing numbers…
A: The given table, a) We know, GDP = C+S C = GDP-S So, At GDP = $480, S = -16, C= 480- (-16) C = 496…
Q: Sumption function from the MPC Consider a hypothetical economy in which the marginal propensity to…
A: Consumption function: C = Co+cYWhere,C is consumptionCo is autonomous consumption e is MPCY is…
Q: Consider an economy described by the following data: C= $3.25 trillion T = $1.3 trillion G= $3.5…
A: answer is in image
Q: The economy is in equilibrium such that Planned Aggregate Expenditure (AE) = Aggregate Output (Y) =…
A: The aggregate demand which would be equal to the output would result in macroeconomic equilibrium…
Q: I have to analyze, using the IS-LM model, the macroeconomic effects of an increase in savings in the…
A: Macroeconomics is a part of economics that deals with output and production and decision-making…
Q: Complete the following table:a. Show the consumption and saving schedules graphically.b. Find the…
A: Average propensity to save shows the ratio of saving to income. Average propensity to consume shows…
Q: Suppose the United States economy is represented by the following equations: Z = C + I + G…
A: National income or equilibrium level of output depends on various factors such as household…
Q: If the consumption function is C= 800 + 0.6(Y- T), output, Y, = $5,100 and net taxes, T, = $100,…
A: please find the answer below.
Q: Suppose the consumption equation is represented by the following: C = 250 + .75YD. Now assume…
A: The equation is C=250+.75YD
Q: • Assuming that there is no government spending or trade, an economy's GDP is the sum of domestic…
A: Answer -
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
- . Let the national income model be; Y = C + I0 + G , C = a + b ( Y – T) , G = g Y Identify endogenous variables Find the equilibrium national income Find equilibrium consumption(using static equilibrium & matrix algebra both)Assume that the economy is now governed by a government and begins trading with other economies. The economy is described by the following set of equations. ?=1000+0.5⋅?d ID = 600 G=700 T=400 EX=0.1⋅Y IM=100+0.1⋅Y YD = Y - T Calculate the equilibrium level of output Y* a) 2857 b) 4000 c) 6274 d) 4400 Whats the government expenditure multiplier? Whats the tax multiplier? Whats the ba;anced budget multiplier?. Suppose the United States economy is repre- sented by the following equations: Z = C + I + G, C = 500 + 0.75YD, T = 600, I = 300, YD = Y − T , G = 2000 Given the above variables, calculate the equilibrium level of output. assume that government spending decreases from 2000 to 1900. What is the new equilibrium level of output? How much does income change as a result of this event? What is the multiplier for this economy?
- Consider the macroeconomic model shown below: C = 500+ 0.80Y | = 1,500 G = 1,000 NX = - 100 Y=C+I+G + NX Consumption function Planned investment function Government spending function Net export function Equilibrium condition Fill in the following table. (Enter your responses as integers.) Aggregate Expenditures (AE) $ $ GDP $11,600 $17,400 Unplanned Change in InventoriesSuppose the United States economy is represented by the following equations: Z = C + I + G C = 500 + .5YD T = 600 I = 300 YD = Y - T G = 2000 Given the above variables, calculate the equilibrium level of output. Now, assume that taxes increase from 600 to 700. What is the new equilibrium level of output? How much does income change as a result of this event? What is the multiplier for this economy?Assume the following model of the expenditure sector: S=C+I+G+Nx TR=100 C=420+(4/5)YD I=160 G=180 Nx=-40 YD=Y+TR-TA TA=(1/6)Y If the government would like to increase the equilibrium level of output (Y) to the full employment level Y*=2,700, by how much should government purchases (G) be changed?
- Suppose the United States economy is represented by the following equations: Z = C + I + G C = 500 + .5YD T = 600 I = 300 YD = Y - T G = 2000 Given the above variables, calculate the equilibrium level of output. Now, assume that government spending decreases from 2000 to 1900. What is the new equilibrium level of output? How much does income change as a result of this event? What is the multiplier for this economy?Suppose an economy is represented by the following equations.Consumption function C = 200 + 0.8YdPlanned investment I = 400Government spending G = 600Exports EX = 200Imports IM = 0.1YdAutonomous Taxes T = 500Marginal Tax Rate t=0.2Planned aggregate expenditure AE = C + I + G + (EX - IM) By using the above information calculate the equilibrium level of income for this economy and explain why fiscal policy becomes less effective in an open economySuppose the United States economy is represented by the following equations: Z = C + I + G C = 500 + .5YD T = 600 I = 300 YD = Y - T G = 2000 a. Given the above variables, calculate the equilibrium level of output. b. Now, assume that taxes increase from 600 to 700. What is the new equilibrium level of output? How much does income change as a result of this event? What is the multiplier for this economy?
- Assume that a nation's marginal propensity to consume (MPC) is 0.75. A highiy productive, cost-cutting technology is developed for the production of commercial airplanes. The total industry expenditure in this nation is $100 million for the immediate acquisition and adoption of this technology. (a) For this nation, identify and explain how much this spending on new technology will change each of the following in the first round: i. Income (GDP) L. Saving i. Consumption (b) Assuming a closed economy and no leakages, identify and explain how much this spending on new technology will change each of the following at the end of the final round: i. Income (GDP) ii. Saving li. ConsumptionAnswer the following questions based on the below graph AE 5000 2000 45 5000 TP Investment I: $400 Government G: $300 AE Taxes T: Net Export NX: $0 $100 a- Graphically determine the equilibrium level of output. b- Derive the consumption and saving functions. c- Mathematically solve for the equilibrium level of income. d- When the economy is at full employment the output level is $5500. How much would government purchases change to create full employment?consider a simple Macroeconomic Model With the following equations: C=500 + 0.9 YD I=650 G=1000 T=0.3Y X=700 IM= 0.23Y a) calculate equilibrium national level of income b) calculate the governments budget balance at the equilibrium national level of income c) calaculate the countrys trade balance d) calculate the mulitplier for this economy