Use the following information to answer questions 21-25. GDP () is 10,000. Consumption (C). is given by the equation C=1,000+0.75(Y-7). Investment (/) is given by the equation /= 1,000-100r, where r is the real interest rate in percent. Taxes (7) are 2,000 and government spending (G) is 2,200. Equilibrium interest rate (r) can be found by setting: Select one: OA S=I OB. Y=C+I+G OC. Both (a) and (b) on None of the aboun

Use the following information to answer questions 21-25. GDP () is 10,000. Consumption (C). is given by the equation C=1,000+0.75(Y-7). Investment (/) is given by the equation /= 1,000-100r, where r is the real interest rate in percent. Taxes (7) are 2,000 and government spending (G) is 2,200. Equilibrium interest rate (r) can be found by setting: Select one: OA S=I OB. Y=C+I+G OC. Both (a) and (b) on None of the aboun

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose the government raised taxes by $100,000 and simultaneously raised spending by $100,000. If the marginal propensity to consume is 0.65, what is the net effect on Gross Domestic Product? (use a negative number if GDP would go down, and a positive number if GDP would go up) Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Use the figure to calculate the marginal propensity to consume (MPC) between point A and point B. MPC = (Enter your response as a real number rounded to two decimal places.) C Real consumption spending ($ billions) Consumption and National Income $3,750 $2,250 B $3,000 $5,000 Real national income or real GDP ($ billions) C
For questions #9, 10, 11, and 12 use the following equation. C = 20 + 0.2(Y – T) 9) What is the marginal propensity to save for this economy? a) 2% b) 20% c) 60% d) 80% ( plz show the equation and how you use the numbers from the equation to solve it)10) What is the tax multiplier for this economy? a) -0.25 b) 0.25 c) -1.25 d) 1.25 11) If the government increases taxes by 20, then how much will consumption change by? a) -5 b) 5 c) -25 d) 25 12) To increase real GDP by 40 the government needs to change government spending by a) 48 b) 40 c) 32 d) 20
QUESTION 36 1 Q = 1- mpc + mpc •t (C, +1+ G + X„) 1 AQ = 1- mpc+ mpc · t (AC, + AI + AG + AX„) | = 100, G = 200, Ca = 100, Xn -100, mpc = 4/5, t (income tax rate) = 1/4 36. Given this model, what is the equilibrium level of income? 125 300 500 750 1,000
We have the following data for a hypothetical closed economy: GNP = $14,000 Consumption (C) = $8,000 Government Purchases (G) = $1,200 Tax Collections (T) = $1,200 What is the value of private savings SP? $ What is the value of government savings S9? $ (Enter your answer as an integer. Include a minus sign if necessary.) (Enter your answer as an integer. Include a minus sign if necessary.) (Enter your answer as an integer. Include a minus sign if necessary.) In this closed economy, what must be the value of investment expenditure? $
Consider an economy of a nation that has the following aggregate expenditure. 1300- 1040- 780- 520- AE 260 Y = AE 260 390 520 650 780 9ło 1040 1170 1300 130 Real GDP Note: Please make sure your final answers are accurate to 2 decimal places. a) What is the value of the equilibrium national real GDP? Equilibrium = $0 b) What is the value of the multiplier? Multiplier = 0 c) If the autonomous consumption were to decrease by $520, what would be the new value of equilibrium real GDP? New equilibrium = S0 Aggregate expenditures
Problem 1 Suppose the system of aggregate expenditures can be described by the following relationships and parameter values. C(Y – T) = 1200 + 0.8(Y – T) I(r) = 100 – 3r G = 200;T = 200; r = 5; Ex = Im = 0 1. In the consumption function, 1200 represents the portion of consumption that is not dependent on disposable income. Suppose something causes households to become concerned about their economic futures and this autonomous consumption falls to 1100. Find the new equilibrium level of Y (output/income).
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.
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Consider the following hypothetical data for the U.S. economy in 2020 (in trillions of dollars), and assume that there are no statistical discrepancies, zero net incomes earned abroad, and zero taxes on production and imports of net subsidie Category Value $1.3 Category Value Corporate profits before taxes deducted Proprietorial income Rent Interest $2.6 Exports 0.8 Net transfers and interest earnings 0.8 Nonincome expense items 0.8 Imports 8.1 Corporate taxes 1.2 Social security contributions 11.7 Government spending 1.9 1.6 1.7 Wages Depreciation Consumption 0.6 2.2 1.7 a. Calculate the gross domestic income. $ 14.7 trillion. (Enter your response rounded to one decimal place.) Calculate GDP. $ 14.7 trillion. (Enter your response rounded to one decimal place.) b. Calculate gross private domestic investment. $ 13 trillion. (Enter your response rounded to one decimal place.)
The following table shows consumption (C), investment spending (I), and government purchases (G), for some hypothetical economy at several levels of income (reported in billions of dollars of real GDP). Assume that in this economy, income is taxed at a rate of 25%, base consumption is $50 billion, and that the marginal propensity to consume (MPC) is 0.667, or 2/3. Further assume that this economy is closed, that is, there is no international trade and so net exports are always equal to zero. Use the given information to fill in disposable income, consumption, and planned expenditures in the following table. Income: Real GDP Disposable (After Tax) Income C Ip G Planned Expenditures (Billions of dollars) (Billions of dollars) (Billions of dollars) (Billions of dollars) (Billions of dollars) (Billions of dollars) 0 0 50 100 50 100 100 50 200 100 50 300 100 50 400 100 50 500 100 50…