Suppose a closed economy has an aggregate saving equal to 300 and intended investment equal to 650. By how much must the government be in surplus? (round your answer to the nearest whole value)
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Suppose a closed economy has an aggregate saving equal to 300 and intended investment equal to 650.By how much must the government be in surplus?
(round your answer to the nearest whole value)
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- Asap3. Suppose field workers in California, one of the largest producers of strawberries in the US, are able to organize into union and receive wage increases of 25%. How will this impact the supply of strawberries in the US market? 4. Suppose a new Congress in 2025 decides to take on the problem of the USA national debt and budget deficits by imposing a 5% tax on new farm equipment to help pay down the debt. How will this impact the supply of food in the United States? 5. Soybean, sorghum, and sunflowers can be grown through many of the states bordering Canada. After Donald Trump left office, China returned to the US market buying large amounts of soybeans to feed its pigs to satisfy Chinese consumer preferences for pork. Assume Donald Trump wins the 2024 election in China boycotts the US soybean market. How was this impact the supply of sunflower seeds in the US market? 6. Recently Vladimir Navalny, a critic of Russian leader Vladimir Putin died in prison. Suppose this results in…The city of Joslyn has three sources of revenue: borrowing, proprietary income from running the local electric power utility, and taxes. Last year, its total revenue was $150 million. If it received $10 million from running the electric power utility and borrowed $40 million, how much did it collect in taxes? Assume Joslyn's total revenue is $150 million. O $100 million O $110 million O $140 million O Nothing
- 14) What could explain what is happening in the graph to the right? a. The government has given investors an investment tax credit, increasing investors appetite for savings. b. The government has removed the tax protected status of IRA accounts, increasing savings. c. The government balances the interest rate Το r1 Eo E1 So $1 budget reducing its debt, and the "crowding out" effect disappears. business desire to obtain funds. 90 91 quantity of loanable funds d. A new technology makes industry much more productive, therefore increasing e. There are many things that could explain what the graph shows us, but we don't have enough information to decide on any of a. thru d. above.3. Use an appropriate diagram to show and discuss how the consideration of a land expropriation bill without compensation might affect the economy.9. Problems and Applications Q9 Investment can be increased both by reducing taxes on private saving and by reducing the government budget deficit. True or False: It is possible to implement both of these policies at the same time because reducing taxes on private spending has the effect of decreasing the government budget deficit. O True False What would you need to know in order to judge which of these two policies would be more effective way to raise investment? Check all that apply. ✓ The elasticity of private saving with respect to the after-tax real interest rate The responsiveness of private saving to increases in investment ✔The response of private saving to changes in the government budget deficit
- Which group is most likely to demand funds from the financial (loanable funds) market? O financial institutions who lend funds to people. O the government when they run a budget surplus. O firms who want to borrow to pay for new capital. O people who have extra income they want to save. « Previous Next ASUS 16 5 6 7 RSuppose that the demand for loanable funds for car loans in the Milwaukee area is $10 million per month at an interest rate of 10 percent per year, $11 million at an interest rate of 9 percent per year, $12 million at an interest rate of 8 percent per year, and so on. If the supply of loanable funds is fixed at $15 million, what will be the equilibrium interest rate? If the government imposes a usury law and says that car loans cannot exceed 3 percent per year, how big will the monthly shortage (or excess demand) for car loans be? What if the usury limit is raised to 7 percent per year?9 Suppose the government borrows $7 billion more next year than this year (for example, they move from a balanced budget to a $7 billion deficit or from a $10 billion deficit to a $17 billion deficit). a Use a supply-and-demand diagram to analyse this policy. What happens to the interest rate? b What happens to investment? To private saving? To public saving? To national saving? Compare the size of the equilibrium changes with the $7 billion of extra borrowing. Is it the same, less or more? Carefully explain why and distinguish the various movements in the diagram. C How do the elasticities of supply of and demand for loanable funds (i.e. the slopes of the curves) affect the size of these changes? (Hint: See chapter 2 to review the definition of elasticity.) d Suppose households believe that greater government saving today implies lower future taxes since there will be little government debt. What does this belief do to private saving and the supply of loanable funds today? Does it…
- 3 Suppose the government offers investment tax credits to firms. In the market for loanable funds, these tax credits would cause the equilibrium real interest rate to Question 9 options: decrease, and producer surplus to decrease. increase, and producer surplus to increase. increase, and producer surplus to decrease. decrease, and producer surplus to increase.4. The market for loanable funds and government policy The following graph shows the loanable funds market. For each of the given scenarios, adjust the appropriate curve on the graph to help you complete the questions that follow. Consider each scenario separately by returning the graph to its starting position when moving from one scenario to the next. (Note: You will not be graded on any changes you make to the graph.) Supply 17 INTEREST RATE (Percent) LOANABLE FUNDS (Billions of dollars) Demand Scenario 1: Suppose savers either buy bonds or make deposits in savings accounts at banks. Initially, the interest income earned on bonds or deposits is taxed at a rate of 18%. Now suppose there is an increase in the tax rate on interest income, from 18% to 22%. Shift the appropriate curve on the graph to reflect this change. The repeal of the previously existing tax credit causes the interest rate to Shift the appropriate curve on the graph to reflect this change. This change in the tax…5. The following data (in millions of dollars) expresses all the relevant information for the agents in a given economy: Consumption 300 Wages and Salaries 275 Net Interest and Rents 40 Government Expenditures on Goods and Services 125 Indirect Taxes Minus Subsidies 60 Imports 100 Exports 150 Gross Investment 90 Depreciation 50 Corporate Profits 75 Proprietor's Income 60 a) Determine the gross domestic product for this economy. b) Determine the national income for this economy. c) Determine the net factor income from abroad for this economy. What is the meaning of this value?