Suppose that disposable income, consumption, and saving in some country are $800 billion, $700 billion, and $100 billion, respectively. Next, assume that disposable income increases by $80 billion, consumption rises by $56 billion, and saving goes up by $24 billion.**Instructions:** In part a, round your answers to 2 decimal places. In part b, round your answers to 3 decimal places.a. What is the economy's MPC?- MPC = [ ] What is its MPS?- MPS = [ ]b. What was the APC before the increase in disposable income?- APC before = [ ] What was the APC after the increase?- APC after = [ ]

Economic measures use mathematical tools to determine the value of economic variables such that:…

Answered: Suppose that disposable income,…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

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Problem 1QTC

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Calculate autonomous consumption expenditure from the following date about an economy which is In equilibrium.National income = Rs. 1,100Marginal propensity to save = 0.20Investment expenditure = Rs. 80(Autonomous Consumption Expenditure = 120
Would like all parts answered please; specifically parts (d,e,f)
An increase in savings implies a decrease in consumption and therefore a decrease in GDP.True/False and Explain .
Which of the following correctly describes how a decrease in the price level affects consumption spending? Select one: a. A decrease in the price level raises real wealth, which causes consumption to increase. b. A decrease in the price level decreases the amount of money a household needs to buy goods and so raises the interest rate, which causes consumption to increase. c. A decrease in the price level increases the amount of money a household needs to buy goods and so raises the interest rate, which causes consumption to increase. d. A decrease in the price level lowers real wealth, which causes consumption to decrease.
1. Consider an economy described by the following data (in $ trillion): Č- 3.25; i- 1.3 ; G= 3.5: T-3.0; NX = -1.00; 7 = 1; mpc= 75; a= 0.3; 6=0.1 a. Drive a simplified expressions for the consumption function, the investment function, and the net export function. a. Drive the expression for the IS curve. b. If the real interest rate is r=2, what is the equilibrium output? If r= 5, what the equilibrium output? c. Draw the graph of the IS curve showing the answers from part (c) above. d. If government purchases increase to $4.2 trillion, what will happen to equilibrium output at r=27 What will happen to equilibrium output at r 5? Show the effect of the increase in government purchases in your graph from (d).
if the government cuts taxes in period 1 and cuts government spending in period 2 - this will increase the disposable income of the consumers - won't this increase consumption for consumers having an ambiguous effect on private saving. this is because if consumption is a normal good - increasing the income - positive income effect. My question is for some reason if consumer' disposable income increases - doesnn't this mean consumption must increase - whether it increases more/ enough to neutralise the tax cut effect is debatable and situation dependent - but surely there is an ambiguous effect on private saving for this reason
15. Total expenditures in a country (in billions of dollars) are increasing at a rate of f(x) = 8.22x+87.13, where x = 0 corresponds to the year 2000. Total expenditures were $1584.9 billion in 2002. a. Find a function that gives the total expenditures x years after 2000. b. What will total expenditures be in 2016? a. What is the function for the total expenditures? F(x)= (Simplify your answer. Use integers or decimals for any numbers in the expression.) b. In 2016, total expenditures will be S (Type an integer or a decimal.) billion.
Explain how China’s real GDP can grow at a 6.9 percent rate when consumption and investment grew faster than 6.9 percent.
Answer the following in 10 minutes I’m studying.
Moving to another question will save this response. Quèstion 23 Assume the following consumption schedule: C= 20 + 0.9 Y, where C is consumption and Y is disposable income. At $1,100 level of disposable come: (show your calculations) a Find out the level of saving and consumption? ( b. How much are the APC and APS (to one decimal place)? c. If disposable income increased to $2,800 and saving is $345 now. What are MPC and MPS (to two decimal places)? J For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). BIUS Paragraph Arial 10pt 三v 三v A v In X, 田田田国 ABC 三三 +, 旺困田田 |用

multiplier? 3. Draw a graph representing a hypothetical economy. Carefully label the two axes, the S+ T+ IM curve, the I+G+ EX curve, and the equilibrium level of real GDP. Illustrate the effect of an increase in the level of autonomous saving.

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