Use the following information on economy X to answer the questions below. Consumption function: C = 350 + 0.6Y Investment spending: I = 250 Government spending: G = 400 Exports of goods and services: X = 300 Imports of goods and services: Z = 150 Proportional tax rate: t =25% (Note: Show all calculations and round off to 2 decimal places). Q.4.1.1 Q.4.1.2 Q.4.1.4 Q.4.1.5 Calculate total autonomous spending for economy X. (3) Calculate the multiplier for economy X. (3) Calculate the budget surplus or deficit at the equilibrium level of income. (3) Calculate the change in equilibrium income if the government decides to (3) increase expenditure to R500. Q.4.1.3 Calculate the equilibrium income for the economy. (Hint: Use the multiplier method). (3)
Use the following information on economy X to answer the questions below.
Consumption function: C = 350 + 0.6Y
Investment spending: I = 250
Government spending: G = 400
Exports of goods and services: X = 300
Imports of goods and services: Z = 150
Proportional tax rate: t =25%
(Note: Show all calculations and round off to 2 decimal places).
Q.4.1.1 Q.4.1.2
Q.4.1.4 Q.4.1.5
Calculate total autonomous spending for economy X. (3) Calculate the multiplier for economy X. (3)
Calculate the budget surplus or deficit at the equilibrium level of income. (3) Calculate the change in equilibrium income if the government decides to (3) increase expenditure to R500.
Q.4.1.3
Calculate the equilibrium income for the economy. (Hint: Use the multiplier method).
(3)
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