11. If investment declines by 50 and marginal propensity to consume is 0.2, what will happen to equilibrium income? a. decline by 62.5 b. increase by 62.5 c. increase by 250 d. decline by 10
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- 61)If the marginal propensity to save is 0.2, then a $10,000 decrease in disposable income will Select one: a. increase consumption by $2,000. b. increase consumption by $8,000. c. decrease consumption by $8,000. d. decrease consumption by $2,000.The following questions refer to this table: a.At each level of output, calculate saving. At each level of out-put, calculate unplanned investment (inventory change).What is likely to happen to aggregate output if the economyproduces at each of the levels indicated? What is the equilib-rium level of output?b.Over each range of income (2,000 to 2,500, 2,500 to 3,000, andso on), calculate the marginal propensity to consume. Calculatethe marginal propensity to save. What is the multiplier?c.By assuming there is no change in the level of the MPC andthe MPS and planned investment jumps by 200 and is sus-tained at that higher level, recompute the table. What is thenew equilibrium level of Y? Is this consistent with what youcompute using the multiplier?Calculate the marginal propensity to save in the economy, if C = 500+ 0.9Y. and investment expenditure is 3000.
- An increase of R5 billion in income in a macroeconomy leads to an increase in R3billion in consumption spending. From this information, we can determine that themarginal propensity to save in this economy is:choose the correct answer(a) 0.6; (b) 0.5;(c) 0.3; (d) 0.418. According to the income and consumption schedules shown above, the marginal propensity to consume is(A) 1.33(B) 0.90(C) 0.80(D) 0.75(E) decreasing as real disposable income How come MPC equals 0.75?In the economy of Spendsalot, the marginal propensity to save, MPS, is 0.8. What is the marginal propensity to consume, MPC, for Spendsalot? Which value does MPC determine? a.the slope of tax revenues as a function of GDP b.the slope of pre‑tax consumption as a function of GDP c.the slope of pre‑tax investment as a function of GDP d.the slope of government consumption as a function of GDP.
- MCQ The table below provides income and consumption data in billions of dollars: Disposable Income Consumption Savings 100 80 --- 200 150 --- Calculate the marginal propensity to consume for the economy. A) 0.8 B) 0.2 C) 0.3 D) 0.7Refer to Figure 1. Injections = leakagesA) when income = zero.B) when consumption = saving.C) at equilibrium.D) when output = investment.The government raises taxes by Rs. 100 billion. If the marginal propensity to consumeis 0.6, what happens to the following – do they rise or fall? By what amounts? a) Public Savingb) Private Savingc) National Saving
- Q) For this question, assume the marginal propensity to consume is 0.7. a. Calculate the change in private saving, public saving, national saving, and investment when taxes increase $100. b. Calculate the change in private saving, public saving, national saving, and investment when government purchases decrease $100. c. Which causes a larger change in investment, the increase in taxes in part a or the decrease in government purchases in part b? Support your answer. Explain it correctly and all subparts.Given that the marginal propensity to cinsume is 0.8 and that the initial change in investment expenditure equals $100 million. (a). Calculate and explain the numeric value of the autonomous investment multiplier? (b). Calculate the resultant change in equilibrium national income?6) If the marginal propensity to save is 0.4 and disposable income decreases from $2,000 to $1,000, saving will A) increase by $80. B) decrease by $80. C) decrease by $400. D) increase by $400. Note:- Please refrain from offering handwritten solutions. Please ensure that your response maintains accuracy and quality to avoid receiving a downvote. Take care of plagiarism. Answer completely. You will get up vote for sure.
