Economics: Principles and Policy (MindTap Course List)
13th Edition
ISBN: 9781305280595
Author: William J. Baumol, Alan S. Blinder
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 26, Problem 2TY
To determine
Determine the equilibrium level of
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Use the following information to complete the calculations.
C = 15235 + 0.67Y
I = 8777
G = 3425
NX = -551
What is the value of autonomous expenditure (AE)? Round your answer to the nearest dollar.
AE: $
Calculate the equilibrium level of GDP. Round your answer to the nearest dollar.
GDP: $
Calculate the four components of aggregate expenditure and GDP for the following economy using data from the table below.Instructions: Enter your responses as whole numbers. If you are entering any negative numbers, be sure to include a negative (-) sign in front of those numbers.
GDP
Consumption expenditures
$600
Exports
$75
Government purchases of goods and services
$200
Construction of new homes and apartments
$100
Sales of existing homes and apartments
$200
Imports
$100
Beginning-of-year inventory stocks
$100
End-of-year inventory stocks
$150
Business fixed investment
$100
Government payments to retirees
$100
Household purchases of durable goods
$150
Consumption expenditures: $
Investment expenditures: $
Government Purchases: $ Net Exports: $ GDP: $
C = 60 + 0.6Yd
T = 40 + 0.25Y
I = 60
G = 70
X = 44
M = 0.15Y
a) Use the above information to calculate the equilibrium level of gross domestic product
(GDP) (reminder: Yd refers to disposable income) (Show your calculations)
Chapter 26 Solutions
Economics: Principles and Policy (MindTap Course List)
Knowledge Booster
Similar questions
- We have obtained the following information about Real GDP in the U.S. economy from 1973:01 through 1975:Q++Data has been provided by the Bureau of Economic Analysis (BEA): Real GDP (billions of chained 2012 $) $5,646.3 $5,707.8 $5,677.7 $5,731.6 $5,682.4 $5,695.9 $5,642.0 $5,620.1 $5,551.7 $5,591.4 $5,687.1 $5,763.7 Year 1973 1974 1975 Quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 A. Create a graph of the above Real GDP data and label the phases of the Business Cycle (Peak, Trough, Recession, Recovery/Expansion). B. In what quarter did the U.S. economy reach a business cycle peak? C. In what quarter did the U.S. economy reach the trough of the business cycle? D. What was the percent decline in Real GDP from the business cycle peak to the trough? RGDP trough - RGDP peak Hint: Economic Growth Rate = x 100 RGDP peakarrow_forwardThis question has four parts. (its not a writing assignment, just asking for a numerical value or simple answer) 1.1. What is the US GDP for the first quarter and second quarter of 2020? What is the personal consumption expenditures for the first quarter and second quarter of 2020? Go to the website for the Bureau of Economic Analyses (BEA): https://www.bea.gov/ Section 1: Domestic Product and Income; Table 1.1.5 1.2. Use the information in Table 1 to analyze aggregate expenditures (AE) model below (Figure 1. Equilibrium in a Private Closed Economy). (table 1 and figure 1 are in the attachments) 1.3. Identify the mistake and explain why the graph of the aggregate expenditures line does not correctly illustrate the economy's equilibrium. 1.4. Create a graph for the aggregate expenditures (AE) model using the data from Table 1: A Private Closed Economy. Tips: Remember, the 45degree line (also known as the Keynesian Cross) is a tool that shows how differences in aggregate…arrow_forwardBelow is a hypothetical table such as would be generated by the Bureau of Labor Statistics when reporting historical and forecasted levels of gross domestic product for the United States. Use the answer table to fill in the blank for the missing estimates. Make sure you show your work. 1. 1998 Gross Domestic Product Answer (Remember to show work) 2 . 2028 Personal Consumption Expenditures Answer (remember to show your work) 3. 2008 Gross Private Domestic Investment answer (remember to show work) 4. 2018 Exports Answer (remember to show work)arrow_forward
- The gross domestic product (GDP) of the United States is defined as the all in a given period of time. Based on this definition, indicate which of the following transactions will be included in (that is, directly increase) the GDP of the United States in 2023. Scenario Generic Motor Company, a U.S. automobile company, produces a pickup truck at a manufacturing facility in Lordstown on January 6, 2023. It sells the car at a dealership in Dallas on February 2, 2023. Graincorp, a U.S. agricultural company, produces corn syrup at a plant in Iowa on September 25, 2023. It sells the corn syrup to Crunchy's for use in the production of cereal that will be made in the United States in 2023. (Note: Focus exclusively on whether production of the corn syrup increases GDP directly, and ignore the effect of production of the cereal on GDP.) Using wood from a red maple tree on your Michigan property you make a birdhouse in 2023. A similar birdhouse sells for $55 in a craft store. Sleepytown, a…arrow_forwardCalculate the four components of aggregate expenditure and GDP for the following economy using data from the table below. Instructions: Enter your responses as whole numbers. If you are entering any negative numbers, be sure to include a negative (-) sign in front of those numbers. Consumption expenditures Exports Government purchases of goods and services Construction of new homes and apartments Sales of existing homes and apartments Imports GDP Beginning-of-year inventory stocks End-of-year inventory stocks Business fixed investment Government payments to retirees Household purchases of durable goods Consumption expenditures: $ Investment expenditures: $ Government Purchases: $ Net Exports: $ GDP: $ $800 $50 $200 $200 $200 $125 $100 $100 $100 $100 $150arrow_forwardUsing the midpoint method (percentage change = change in quantity/average), calculate the percentage change in a nation’s GDP from $1 trillion in 2005 and $1.03 trillion in 2006. Group of answer choicesarrow_forward
- The accompanying table shows a portion of quarterly data for real personal consumption (Consumption in $) and real personal disposable income (Income in $) for the years 2000-2019. Date Q1,2000 Q2, 2000 A Q4,2019 Consumption 8520.71 8603.01 ⠀ 13411.94 Income 9338.68 9441.95 1 15100.13 pictureClick here for the Excel Data File a. Construct a scatterplot of Consumption against Income. Given the scatterplot, which statement best describes the relationship between Consumption and Income? O Consumption and Income have a positive relationship. O Consumption and Income have a negative relationship. O Consumption and Income have no relationship. O Consumption and Income have a U-shaped (nonlinear) relationship.arrow_forwardCalculate the four components of expenditure and GDP for the following economy using data from the table below. Instructions: Enter your responses as whole numbers. GDP Data $600 Consumption expenditures Exports $75 $200 Government purchases of goods and services Construction of new homes and apartments Sales of existing homes and apartments Imports Beginning-of-year inventory stocks End-of-year inventory stocks Business fixed investment Government payments to retirees Household purchases of durable goods $100 $200 $50 $100 $125 $100 $100 $150 Consumption expenditures: Investment expenditures: $| Government Purchases: $ Net Exports: GDP:arrow_forwardSuppose the data BELOW is for a given year from the annual Economic Report of the President. Calculate GDP using the expenditure approach (Amount in billions of dollars): Corporate profits: $ 305Depreciation: $ 479Gross private domestic investment: $716Personal taxes: $ 565Personal saving: $120Government spending: 924Imports: $ 547Exports: $ 427Personal consumption expenditures: $ 2,966Indirect business taxes: $ 370Contributions for Social Security (FICA): $ 394Transfer payments and other income: $ 967arrow_forward
- a) Calculate GDP Deflator of 2009. b) Calculate the Growth rate of real GDP of 2009. c) What can you conclude from your answer to part a. d) What can you conclude from your answer to part b. Please answer all and answer must be correct.arrow_forwardNow use the table to find aggregate expenditure and the unplanned change in Inventories, Real GDP Consumption (C) $9,900 $10,800 ( $11,000 $12,000 Planned Investment () $1,100 $1,100 Government Purchases (G) $1,200 1,200 Net Exports (NX) -$275 - $275 Planned Aggregate Expenditure (AE) Unplanned Change in Inventoriesarrow_forwardPlease give a detailed response for the question below.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning