13. a, The accompanying table shows gross domestic product (GDP), disposable income (YD), con- sumer spending (C), and planned investment spending (Iplannea) in an economy. Assume there is no government or foreign sector in this economy. Complete the table by calculating planned aggre- gate spending (AEPlanned) and unplanned inven- tory investment (IUnplanned). GDP YD C IPlanned AEPlanned lunplanned (billions of dollars) $0 $0 $100 $300 400 400 400 300 800 800 700 300 1,200 1,200 1,000 300 1,600 1,600 1,300 300 ? 2,000 2,000 1,600 300 ? 2,400 2,400 1,900 300 2,800 2,800 2,200 300 ? 3,200 3,200 2,500 300
13. a, The accompanying table shows gross domestic product (GDP), disposable income (YD), con- sumer spending (C), and planned investment spending (Iplannea) in an economy. Assume there is no government or foreign sector in this economy. Complete the table by calculating planned aggre- gate spending (AEPlanned) and unplanned inven- tory investment (IUnplanned). GDP YD C IPlanned AEPlanned lunplanned (billions of dollars) $0 $0 $100 $300 400 400 400 300 800 800 700 300 1,200 1,200 1,000 300 1,600 1,600 1,300 300 ? 2,000 2,000 1,600 300 ? 2,400 2,400 1,900 300 2,800 2,800 2,200 300 ? 3,200 3,200 2,500 300
Chapter19: Measuring Economic Performance
Section: Chapter Questions
Problem 3P
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13. а,
The accompanying table shows gross domestic
product (GDP), disposable income (YD), con-
sumer spending (C), and planned investment
spending (Iplanned) in an economy. Assume there is
no government or foreign sector in this economy.
Complete the table by calculating planned aggre-
gate spending (AEplanned) and unplanned inven-
tory investment (IUnplanned).
GDP
YD
C
IPlanned AEPlanned lunplanned
(billions of dollars)
$0
$0 $100
$300
400
400
400
300
800
800
700
300
1,200 1,200 1,000
300
1,600 1,600 1,300
300
2,000 2,000 1,600
300
2,400 2,400 1,900
300
2,800 2,800 2,200
300
3,200 3,200 2,500
300
?
b. What is the aggregate consumption function?
c. What is Y*, income-expenditure equilibrium GDP?
d. What is the value of the multiplier?
e. If planned investment spending falls to $200 billion,
what will be the new Y*?
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