the equilibrium income in Country H, the government deficit and the current account balance.

Question

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Answer 1

Question

Chapter 34, Problem 2.2P

Subpart (a):

To determine

To determine the equilibrium income in Country H, the government deficit and the current account balance.

Subpart (b):

To determine

To determine the equilibrium income when the government spending increases and the impact on imports based on the multiplier.

Subpart (c):

To determine

To determine the impact of an import quota on multiplier.

Subpart (d):

To determine

To determine how to attain the current account balance.

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A 3-sector economic model was constructed and solved, and assuming the parameters take on certain values, the multiplier matrix that is obtained is displayed in Table 1. You are required to answer the following questions by showing your calculation in the space provided. Table 1: Multiplier Matrix Exogenous Variables Endogenous Variables I* G* T* : Output : Consumption Expenditure 1.895 : Tax Revenue Y 2.631 2.631 - 2.105 C 1.895 - 2.316 T 0.263 0.263 0.789 YD : Disposable Income : Government Budget 2.368 2.368 - 2.895 0.263 - 0.737 0.789 Balance : Saving 0.474 0.474 - 0.579 (a) If autonomous investment is reduced by 100, justify its precise impact on disposable income and tax. Answer : AYD = AT = 80, what is the amount of (b) If the govemment has increased its spending by autonomous tax that is required so that the govemment's action in increasing its spending does NOT have an impact on the government's budget balance? Answer : AT* =

From the graph above, complete the aggregate consumption function from the information provided. C = ___ + ___Y

Calculate the missing values in the table below given that the Aggregate Consumption Function for a country is equal toC= 150 + 0.75Y and planned investment is fixed at 300. Aggregate Output (Income) (Y) Aggregate Consumption Investment (C) Unplanned Inventory Change (Y-AE) Planned Planned Aggregate Expenditure (AE) Equilibrium? (1) 1,500 300 1,800 300 2,100 300 2,400 300 2,700 300 What is likely to happen to aggregate output if the economy produces above the equilibrium level? How much is aggregate saving at the equilibrium level? Calculate the multiplier. Calculate the new equilibrium if Planned Investment increased by $50M.

Answer 2

Question

Chapter 34, Problem 2.2P

Subpart (a):

To determine

To determine the equilibrium income in Country H, the government deficit and the current account balance.

Subpart (b):

To determine

To determine the equilibrium income when the government spending increases and the impact on imports based on the multiplier.

Subpart (c):

To determine

To determine the impact of an import quota on multiplier.

Subpart (d):

To determine

To determine how to attain the current account balance.

Expert Solution & Answer

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Answer 3

Question

Chapter 34, Problem 2.2P

Subpart (a):

To determine

To determine the equilibrium income in Country H, the government deficit and the current account balance.

Subpart (b):

To determine

To determine the equilibrium income when the government spending increases and the impact on imports based on the multiplier.

Subpart (c):

To determine

To determine the impact of an import quota on multiplier.

Subpart (d):

To determine

To determine how to attain the current account balance.

Expert Solution & Answer

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Answer 4

Question

Chapter 34, Problem 2.2P

Subpart (a):

To determine

To determine the equilibrium income in Country H, the government deficit and the current account balance.

Subpart (b):

To determine

To determine the equilibrium income when the government spending increases and the impact on imports based on the multiplier.

Subpart (c):

To determine

To determine the impact of an import quota on multiplier.

Subpart (d):

To determine

To determine how to attain the current account balance.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 5

Chapter 34, Problem 2.2P

Subpart (a):

To determine

To determine the equilibrium income in Country H, the government deficit and the current account balance.

Subpart (b):

To determine

To determine the equilibrium income when the government spending increases and the impact on imports based on the multiplier.

Subpart (c):

To determine

To determine the impact of an import quota on multiplier.

Subpart (d):

To determine

To determine how to attain the current account balance.

Answer 6

Chapter 34, Problem 2.2P

Subpart (a):

To determine

To determine the equilibrium income in Country H, the government deficit and the current account balance.

Answer 7

Chapter 34, Problem 2.2P

Subpart (a):

To determine

To determine the equilibrium income in Country H, the government deficit and the current account balance.

Answer 8

Subpart (b):

To determine

To determine the equilibrium income when the government spending increases and the impact on imports based on the multiplier.

Answer 9

Subpart (b):

To determine

To determine the equilibrium income when the government spending increases and the impact on imports based on the multiplier.

Answer 10

Subpart (c):

To determine

To determine the impact of an import quota on multiplier.

Answer 11

Subpart (c):

To determine

To determine the impact of an import quota on multiplier.

Answer 12

Subpart (d):

To determine

To determine how to attain the current account balance.

Answer 13

Subpart (d):

To determine

To determine how to attain the current account balance.

Answer 14

Expert Solution & Answer

Answer 15

Expert Solution & Answer

Answer 16

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Answer 17

Ch. 34.A - Prob. 1P Ch. 34 - Prob. 1.2P Ch. 34 - Prob. 2.1P Ch. 34 - Prob. 2.2P Ch. 34 - Prob. 3.2P Ch. 34 - Prob. 3.3P Ch. 34 - Prob. 3.4P Ch. 34 - Prob. 3.5P Ch. 34 - Prob. 3.6P Ch. 34 - Prob. 3.8P

the equilibrium income in Country H, the government deficit and the current account balance.

Solution Summary: The author explains the equilibrium income in Country H, the government deficit and the current account balance.

To determine the equilibrium income in Country H, the government deficit and the current account balance.

To determine the equilibrium income when the government spending increases and the impact on imports based on the multiplier.

To determine the impact of an import quota on multiplier.

To determine how to attain the current account balance.

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Chapter 34 Solutions