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Using the information below for a four sector economy, calculate the following: C T | G = 350 +0.55 Yd =200+ 0.25 Y 500 + 0.2 Y = 450 + 0.15 Y = 250 M = 250 +0.2 Y Yf = 2,270.5 Yd = Y-T (Assume price remain constant) Part 1: What is the value of Ye? Number Part 2: What is the value of the Govt surplus(+)/deficit(-) at Ye? Number Part 3: What is the size of the positive(+)/negative(-) output gap? Number Part 4: What change in government spending (increase(+)/decrease(- ) is required to close the gap? Number Part 5: Suppose that government spending changes to G'=550 +0.1 Y. What is the value of the new equilibrium income (Ye2)? Number Using the new government spending function in Part 5, calculate the following: Part 6: What is the size of the positive(+)/negative(-) output gap? Number Part 7: Change in government spending (increase(+)/decrease(-) required to close the new gap? Number Part 8: What was the value of the Govt surplus (+)/deficit(-) at Ye2? (Before the change that took place in part 7) Number

Using the information below for a four sector economy, calculate the following: C T | G = 350 +0.55 Yd =200+ 0.25 Y 500 + 0.2 Y = 450 + 0.15 Y = 250 M = 250 +0.2 Y Yf = 2,270.5 Yd = Y-T (Assume price remain constant) Part 1: What is the value of Ye? Number Part 2: What is the value of the Govt surplus(+)/deficit(-) at Ye? Number Part 3: What is the size of the positive(+)/negative(-) output gap? Number Part 4: What change in government spending (increase(+)/decrease(- ) is required to close the gap? Number Part 5: Suppose that government spending changes to G'=550 +0.1 Y. What is the value of the new equilibrium income (Ye2)? Number Using the new government spending function in Part 5, calculate the following: Part 6: What is the size of the positive(+)/negative(-) output gap? Number Part 7: Change in government spending (increase(+)/decrease(-) required to close the new gap? Number Part 8: What was the value of the Govt surplus (+)/deficit(-) at Ye2? (Before the change that took place in part 7) Number

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Using the information below for a four sector economy, calculate the following: C T | G = 350 +0.55 Yd =200+ 0.25 Y 500 + 0.2 Y = 450 + 0.15 Y = 250 M = 250 +0.2 Y Yf = 2,270.5 Yd = Y-T (Assume price remain constant) Part 1: What is the value of Ye? Number Part 2: What is the value of the Govt surplus(+)/deficit(-) at Ye? Number Part 3: What is the size of the positive(+)/negative(-) output gap? Number Part 4: What change in government spending (increase(+)/decrease(- ) is required to close the gap? Number Part 5: Suppose that government spending changes to G'=550 +0.1 Y. What is the value of the new equilibrium income (Ye2)? Number Using the new government spending function in Part 5, calculate the following: Part 6: What is the size of the positive(+)/negative(-) output gap? Number Part 7: Change in government spending (increase(+)/decrease(-) required to close the new gap? Number Part 8: What was the value of the Govt surplus (+)/deficit(-) at Ye2? (Before the change that took place in part 7) Number
Transcribed Image Text:Using the information below for a four sector economy, calculate the following: C T | G = 350 +0.55 Yd =200+ 0.25 Y 500 + 0.2 Y = 450 + 0.15 Y = 250 M = 250 +0.2 Y Yf = 2,270.5 Yd = Y-T (Assume price remain constant) Part 1: What is the value of Ye? Number Part 2: What is the value of the Govt surplus(+)/deficit(-) at Ye? Number Part 3: What is the size of the positive(+)/negative(-) output gap? Number Part 4: What change in government spending (increase(+)/decrease(- ) is required to close the gap? Number Part 5: Suppose that government spending changes to G'=550 +0.1 Y. What is the value of the new equilibrium income (Ye2)? Number Using the new government spending function in Part 5, calculate the following: Part 6: What is the size of the positive(+)/negative(-) output gap? Number Part 7: Change in government spending (increase(+)/decrease(-) required to close the new gap? Number Part 8: What was the value of the Govt surplus (+)/deficit(-) at Ye2? (Before the change that took place in part 7) Number
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