Please refer to this question as you answer the one attached since they are linked.a)What is equilibrium income in hypothetica,what is the government deficit? What is the current account balance? d. If exports are fixed at EX = 25, what must income be toensure a current account balance of zero? (Hint: Importsdepend on income, so what must income be for imports tobe equal to exports?) By how much must we cut governmentspending to balance the current account? (Hint: Use youranswer to the first part of this question to determine howmuch of a decrease in income is needed. Then use the multi-plier to calculate the decrease in G needed to reduce incomeby that amount.) (1) Consumption function: C = 100 + .8Y,(2) Planned investment:I= 38(3) Government spending: G=75(4) Exports: EX = 25(5) Imports: IM = .05 Y4(6) Disposable income: Y = Y- T(7) Taxes: T= 40%3D(8) Planned aggregate expenditure:AE = C+I+ G+ EX– IM(9) Definition of equilibrium income: Y = AE

Answer- Need to find- equilibrium income in hypothetical,what is the government deficit? What is the…

Answered: Please refer to this question as you…

Please refer to this question as you answer the one attached since they are linked. a)What is equilibrium income in hypothetica,what is the government deficit? What is the current account balance

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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No. 6 Consider the following equations for this particular economy. C = 100+ 0.75Yd I = 150 G = 250 T = 200 X = 100 Q = 0.25Yd a. What is the equilibrium level of income of this economy? Is the trade balance in deficit or surplus? By how much? b. Suppose there is an increase in government expenditures by 50. What is the effect on the equilibrium level of income? What is the effect on the trade balance? Explain your answers. C. This question is independent of Question (b). Suppose exports increase by 50. Compared to you answer in (a), what is the effect on the equilibrium level of income and on the trade balance? Explain your answers.
QUESTION 10 In a large open economy, the home country's saving and investment equations are: sd=200+ 1400r" and Id=300 – 400r" The foreign country's saving and investment equations are: sd= 50+ 600rW and Id=75– 100r" Calculate the current account balance in the foreign country. Note: Type in your answer approximated to two decimal points, i.e., your answer must be of the form "999.99". I will not be able to fix correct answers that were entered incorrectly, such as "999.999" or "999,99" or "999". In case the last digit in the correct answer is zero, e.g., "999.90" or "999.00", Blackboard will automatically delete it and you should not do anything about it.
You have just been hired by the U.S. government to analyze the following scenario. Suppose the U.S. agricultural industry is concerned about the level of fruit and vegetable imports to the United States, a practice that hurts domestic producers. Lobbyists claim that implementing a tariff on imports would shrink the size of the trade deficit. The following exercise will help you to analyze this claim. The following graph shows the demand and supply of U.S. dollars in a model of the foreign-currency exchange market. Shift the demand curve, the supply curve, or both to show what would happen if the government decided to implement the tariff. Given this change, the dollar_______ (appreciates/depreciates). Fill in the following table with the effect of a tariff on the following items:
United States currently runs a significant trade deficit with the rest of the world. Research an academic journal article regarding some of our trade balances with specific countries and share what you find. For example, with whom do we run the largest deficits, with whom do we have surpluses, etc.? Do you think it is a problem if we run a trade deficit? Why or why not? In answering, keep in mind what impact a trade deficit has on other parts of our balance of payments.
QUESTION 9 As a result of entering the world economy, Neverland experiences economic boom and its GDP goes up to y= 13250: The functions that describe consumption and investment are still the same: cd(r) = 5000 – 1000r+ 0.25Y and Id(r) = 500 – 1800r +0.2Y. The government wants to take advantage of growth and increases its expenditures to: G- 1000: What is Neverland's current account balance? Note: Type in your answer approximated to two decimal points, i.e., your answer must be of the form "999.99". I will not be able to fix correct answers that were entered incorrectly, such as "999.999" or "999,99" or "999". In case the last digit in the correct answer is zero, e.g., "999.90" or "999.00", Blackboard will automatically delete it and you should not do anything about it.
Suppose that the government deficit is 20, interest on the government debt is 15, taxes are 55, government expenditures are 50, consumption expenditures are 65, ne factor payments are 25, the current account surplus is - 10, and national saving is 40. Calculate the following (not necessarily in the order given): a. Private disposable income = b. Transfers from the government to the private sector = c. Gross national product d. Gross domestic product : e. The government surplus = f. Net exports %D g. Investment expenditures =
In an economy open to trade, must a government budget deficit always be accompanied by an external sector deficit? Why or why not? Could a government budget deficit lead to a government budget surplus?
A country has 4,000 in domestic savings and firms spent 4,140 on new plant and equipment. The national budget surplus is 60. What must the country’s trade balance be?
Calculate the value of revenue deficit when the given values are:- Revenue expenditure = 140 Tax revenue = 60 Non tax revenue = 20
Summarize the effects of a budget deficit by filling in the following table.Real Interest RateReal Exchange RateTrade BalanceEffects of a Budget Deficit
1. Imports, exports, and the trade balanceThe following table shows the approximate value of exports and imports for the United States from 1997 through 2001.Complete the table by calculating the surplus or deficit both in absolute (dollar) terms and as a percentage of GDP. If necessary, round your answers to the nearest hundredth.YearGDPExportsImportsExports – Imports(Billions of dollars)(Billions of dollars)(Billions of dollars)(Billions of dollars)(Percentage of GDP)19978,332.0 954.41,055.8 19988,794.0 953.91,115.7 19999,354.0 989.31,251.4 20009,952.0 1,093.21,475.3 200110,286.0 1,027.71,398.7 Source: “Income, Expenditures, Poverty, & Wealth: Gross Domestic Product (GDP),” United States Census Bureau, United States Department of Commerce, last modified September 2011, accessed June 10, 2013, https://www.census.gov/library/publications/2011/compendia/statab/131ed/income-expenditures-poverty-wealth.html. Between 1997 and 1998, the in dollar terms and as a percentage of GDP.
The exchange rate between the United States dollar and the Japanese yen is determined in a flexible foreign exchange market. A. Assume that Japan is currently in a recession. What fiscal policy action could the Japanese government take to eliminate the recession? B. What would be the effect of the fiscal policy action identified in Part A on interest rates in Japan? C. Draw a correctly labeled graph of the foreign exchange market for the United States dollar. Show on your graph the impact of the change in interest rates identified in Part B on each of the following: i. The supply of United States dollars i. The equilibrium exchange rate of the United States dollar D. What would be the effect of the change in the exchange rate identified in Part Cil on United States imports? E. What would be the effect of the change in United States exports identified in Part D on United States unemployment?