refer to the following table:Consumption expenditure (C)= 100+ 0.8 YdInvestment expenditure (1) = 120-500/Government spending (G)-50Money demanded for Asset purpose = 100-2000 iMoney demanded for transaction purpose- 60+0.1 YMoney demanded for precautionary purpose 40Where i is the interest rate, Y is the real GDP; Yd is the disposable incomeSuppose Grises by 100 S because of increased expenditure on education. What is the new equilibrium Y?460024441444.441131.1482000Taxes 0.1 YCurrent account 0Demand deposits 60Saving deposits 30Currency in circulation-10Banks reserves-20

Answer: Given, C=100+0.8YdI=120-500iG=50 G rises by 100, Thus new G will be:G=150Taxes=0.1YMoney…

refer to the following table: Consumption expenditure (C)= 100+ 0.8 Yd Investment expenditure (1) = 120-500/ Government spending (G)-50 Money demanded for Asset purpose= 100-2000 i Money demanded for transaction purpose= 60+0.1 Y Money demanded for precautionary purpose 40 Where is the interest rate, Y is the real GDP; Yd is the disposable income Suppose G rises by 100 S because of increased expenditure on education. What is the new equilibrium Y? 4600 2444 1444.44 1131.148 2000 Taxes 0.1Y Current account-0 Demand deposits 60 Saving deposits 30 Currency in circulation-10 Banks reserves 20

refer to the following table: Consumption expenditure (C)= 100+ 0.8 Yd Investment expenditure (1) = 120-500/ Government spending (G)-50 Money demanded for Asset purpose= 100-2000 i Money demanded for transaction purpose= 60+0.1 Y Money demanded for precautionary purpose 40 Where is the interest rate, Y is the real GDP; Yd is the disposable income Suppose G rises by 100 S because of increased expenditure on education. What is the new equilibrium Y? 4600 2444 1444.44 1131.148 2000 Taxes 0.1Y Current account-0 Demand deposits 60 Saving deposits 30 Currency in circulation-10 Banks reserves 20

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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