In a simple economy (assume there are no taxes; thus, Y is disposable income), the consumption function is: C=200+0.80Y. The current level of real GDP is $3000. At this level of real GDP, consumption will be $ nearest dollar.) At a real GDP level of $3000, the average propensity to consume is and savings will be $ If GDP were to increase by $1000, consumption would increase by $ and the average propensity to save is (Round your responses to the (Round your answers to two decimal places.)

In a simple economy (assume there are no taxes; thus, Y is disposable income), the consumption function is: C=200+0.80Y. The current level of real GDP is $3000. At this level of real GDP, consumption will be $ nearest dollar.) At a real GDP level of $3000, the average propensity to consume is and savings will be $ If GDP were to increase by $1000, consumption would increase by $ and the average propensity to save is (Round your responses to the (Round your answers to two decimal places.)

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

In a simple economy (assume there are no taxes; thus, Y is disposable income), the consumption function is:
C=200+0.80Y.
The current level of real GDP is $3000.
At this level of real GDP, consumption will be $
nearest dollar.)
At a real GDP level of $3000, the average propensity to consume is
and savings will be $
If GDP were to increase by $1000, consumption would increase by $. (Round your responses to the
and the average propensity to save is. (Round your answers to two decimal places.)

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