P level A 60 50 40 30 20 10 0 0 10 20 30 40 real GDP = Q LRAS -AS- AD 50 40. Which of the figures above illustrates the problem of recessionary gap? O a) Figure A Ob) Figure B O c) Figure C 60 P level 50 40 30 20 10. 0 0 B LRAS 10 20 30 40 real GDP = Q AS AD 50 60 50 40 30 20 10 P level 0- 0 10 C LRAS 20 30 40 real GDPQ -AS- AD 50

P level A 60 50 40 30 20 10 0 0 10 20 30 40 real GDP = Q LRAS -AS- AD 50 40. Which of the figures above illustrates the problem of recessionary gap? O a) Figure A Ob) Figure B O c) Figure C 60 P level 50 40 30 20 10. 0 0 B LRAS 10 20 30 40 real GDP = Q AS AD 50 60 50 40 30 20 10 P level 0- 0 10 C LRAS 20 30 40 real GDPQ -AS- AD 50

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Use the table below to answer the following question. Income (Dollars) 20,000 24,000 O 0.75 What is the marginal propensity to consume? O 0.875 O 0.90 Consumption (Dollars) O 1.33 18,000 21,500
If real GDP is $2200 billion, the GDP deflator is 110, nominal net exports are $100 billion, nominal investment is $200 billion, and nominal government expenditures are $400 billion, what is nominal consumption? 1) $1300 2) $1500 3) $1520 O 4) $1720
Based on the following statistics, how much is consumption? Total spending Investment Government spending Exports Imports O-$0.38 trillion O $5.13 trillion O $6.49 trillion O $11.62 trillion $11.62 trillion $2.56 trillion $2.95 trillion $1.80 trillion $2.18 trillion
9. Suppose Amal calculates her permanent income by adaptive expectations . Year 2020 Amal's permanent income was 38,000 , and year 2021 actual income is 41,000 . Assume that , long - run marginal to consume is 0.90 and short - run marginal propensity to consume is 0.28 . What is her consumption expenditure year 2021 ? O 36.774 O 35,040 O 40.226 O 33.454 O 34.740 O None of the above is correct
During 2019, a country reported that its real GDP increased by $3.0 billion. If the slope of its aggregate planned expenditure curve is 0.9, then which of the following might have led to the increase in real GDP? O a. Investment decreased by $0.3 billion. on O b. Exports increased by $0.3 billion. O c. Exports decreased by $0.3 billion. O d. Imports increased by $0.3 billion. O e. Government expenditure on goods and services increased by $3 billion.
If aggregate expenditure is greater than real GDP, we could expect which of the following to
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Quèstion 1 In an open mixed economy, the inflationary expenditure gap may be described as the O A. excess of Sa + M+T over lg + X+ G at the full-employment GDP. O B. excess of GDP over Ca + lg +Xn + G at the full-employment output. OC excess of Ca + Ig + Xn + G at the full-employment GDP. O D. extra consumption that occurs when investment increases in a full-employment economy.
determine the equilibrium level of real GDP and the MPC.
Please no written by hand solution
4. Assume the following model of the expenditure sector: AD=C+I+G+NX C = 420 + (4/5)YD YD=Y–TA+TR TA = (1/6)Y TRo = 100 Io = 160 Go = 180 NXo =–40 b) Assume we want to reach Y* = 2700 by changing government transfer payments (TR) instead. By how much should TR be changed?
QUESTION 14 Expenditures, Income Price level 60 50 40 30 20 10 80 70 60 50 40 30 20 10 0 0 0 10 Qe Qf0 40 50 LRAS 10 Qe20 Qf 30 O (d) All the above. O (e) Only (a) and (b) are true O (f) None of the above. AE1 AE* ΑΕo real GDP = Q ADO AS AD1 40 50 real GDP = Q 14. Which of he following statements accurately explain the scenario illustrated by these diagrams? O (a) Assuming ADo and AEo are the original positions of the AD and AE curves respectively, the original situation illustrated is a recessionary gap of 10. O (b) To restore full-employment equilibrium Aggregate Expenditures must be increased to AE1 which is equivalent to shifting the AD curve to AD1 O (c) Because the short-run Aggregate Supply (AS) curve is upward sloping, the shift in AD will be associated with some products price inflation. This will cause the AE curve to decline from AE1 to AE* because of the wealth, interest rate, and trade effects of inflation.