TABLE 1. Given: /= 150, G = 200, and T = 200, and C=150+.85Yd Fill in Cells & Find Equilibrium Y=AE 1 2 3 (Income) 1,500 1,700 2,000 2,200 1 OUTPUT (INCOME) Net Taxes I 1,500 1,700 2,000 2,200 Disposable Income Consumption Spending Y Y-T € 150+.85 Y 4 3 DISPOSABLE 4 CONSUMPTION 5 INCOME SPENDING Y Y T € 150+.85 Yd PLANNED Expenditure Saving (S) (Optionall (Y, C) TABLE 2. Finding Equilibrium After a $30 Billion Investment Spending Decrease Fill in Cells & Find Equilibrium Y=AE 2 NET TAXES T 5 SAVING 6 5 (Y,-E) 7 Investment Government Spending Purchases 1 G 6 7 INVESTMEN GOVERNME T NT PURCHASES G 1 8 PLANNED Aggregate Expenditure C+I+G 8 AGGREGATE EXPENDITURE C+I+G 9 UNPLANNED Inventory Change Y-(C+I+G) 9 INVENTORY CHANGE Y = {C + / +G] 10 Adjustment To Disequilibrium 10 ADJUSTMENT TO Disequilibrium

TABLE 1. Given: /= 150, G = 200, and T = 200, and C=150+.85Yd Fill in Cells & Find Equilibrium Y=AE 1 2 3 (Income) 1,500 1,700 2,000 2,200 1 OUTPUT (INCOME) Net Taxes I 1,500 1,700 2,000 2,200 Disposable Income Consumption Spending Y Y-T € 150+.85 Y 4 3 DISPOSABLE 4 CONSUMPTION 5 INCOME SPENDING Y Y T € 150+.85 Yd PLANNED Expenditure Saving (S) (Optionall (Y, C) TABLE 2. Finding Equilibrium After a $30 Billion Investment Spending Decrease Fill in Cells & Find Equilibrium Y=AE 2 NET TAXES T 5 SAVING 6 5 (Y,-E) 7 Investment Government Spending Purchases 1 G 6 7 INVESTMEN GOVERNME T NT PURCHASES G 1 8 PLANNED Aggregate Expenditure C+I+G 8 AGGREGATE EXPENDITURE C+I+G 9 UNPLANNED Inventory Change Y-(C+I+G) 9 INVENTORY CHANGE Y = {C + / +G] 10 Adjustment To Disequilibrium 10 ADJUSTMENT TO Disequilibrium

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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