Amount by which government will have to increase its spending to achieve an increase in real GDP demanded from $14 trillion to $15 trillion. Introduction: The simple spending multiplier indicates how much the total spending increases, given a change in income. The spending multiplier is determined by the following equation: 1 ( 1 − M P C )

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Exercise 5Consider the demand and supply functions for the notebooks market.QD=10,000−100pQS=900pa. Make a table with the corresponding supply and demand schedule.b. Draw the corresponding graph.c. Is it possible to find the price and quantity of equilibrium with the graph method? d. Find the price and quantity of equilibrium by solving the system of equations.

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Chapter 9, Problem 5.11P

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Amount by which government will have to increase its spending to achieve an increase in real GDP demanded from $14 trillion to $15 trillion.

Introduction: The simple spending multiplier indicates how much the total spending increases, given a change in income. The spending multiplier is determined by the following equation: 1(1−MPC)

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Exercise 5Consider the demand and supply functions for the notebooks market.QD=10,000−100pQS=900pa. Make a table with the corresponding supply and demand schedule.b. Draw the corresponding graph.c. Is it possible to find the price and quantity of equilibrium with the graph method? d. Find the price and quantity of equilibrium by solving the system of equations.

1. Consider the market supply curve which passes through the intercept and from which the marketequilibrium data is known, this is, the price and quantity of equilibrium PE=50 and QE=2000.a. Considering those two points, find the equation of the supply. b. Draw a graph for this equation. 2. Considering the previous supply line, determine if the following demand function corresponds to themarket demand equilibrium stated above. QD=.3000-2p.

Supply and demand functions show different relationship between the price and quantities suppliedand demanded. Explain the reason for that relation and provide one reference with your answer.