2. (2) Valeria is a closed economy, where consumption totals $3 billion, tax payments are $300 million, gov spending is $1 billion, and GDP is $5 billion. Private saving amounts to A B C D $1.7 billion and Valeria's government runs a budget deficit. $1.7 billion and Valeria's government runs a budget surplus. $1 billion and Valeria's government runs a budget deficit. $1 billion and Valeria's government runs a budget surplus

2. (2) Valeria is a closed economy, where consumption totals $3 billion, tax payments are $300 million, gov spending is $1 billion, and GDP is $5 billion. Private saving amounts to A B C D $1.7 billion and Valeria's government runs a budget deficit. $1.7 billion and Valeria's government runs a budget surplus. $1 billion and Valeria's government runs a budget deficit. $1 billion and Valeria's government runs a budget surplus

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter31: The Impacts Of Government Borrowing

Section: Chapter Questions

Problem 16CTQ: Assume there is no discretionary increase in government spending. Explain how an improving economy...

See similar textbooks

Similar questions

(11) The fiscal balance is the difference between exports and imports. government expenditure and revenue. production and consumption. savings and investment. lending and borrowing. (12) What is the effect of a fall in domestic savings on the rate of interest and the level of investment? Neither the interest rate nor the level of investment change. The interest rate rises and the level of investment falls. The interest rate and the level of investment both fall. The interest rate and the level of investment both rise. The interest rate falls and the level of investment rises. (13) The real exchange rate is defined as the amount of (local, foreign) (currency, products) required to exchange for a given amount of (local, foreign) (currency, products). local currency; foreign currency. foreign currency; local currency. local products; foreign currency. local products; foreign products. local currency; foreign products. (10) Over the last two decades, nominal salaries in Jamaica…
2. Compared to a balanced budget or a budget surplus, what is the effect of a government budget deficit on national saving in the economy? A. National saving is unchanged. OB. National saving decreases. OC. National saving increases. D. National saving could increase or decrease. 3. What is the effect of a budget deficit created by an increase in government
10) Suppose net taxes are $50 billion. Government spending is $125 billion. Investment is $50 billion and consumption is $100 billion. What is national savings? A) 50 billion B) -50 billion C) 75 billion D) -75 billion.
1. Suppose a closed economy hasnational income of $50 million,Investment of $2 million,Inflation rate of 5%, net tax rateof 15% and a budget surplus of$4 million. Find value of government purchases (G).
3 Fiscal Policy and how it can be implemented in a recessionary gap. Recently, COVID-19 has resulted in many government officials issuing executive orders to shelter in place as a way to fight surge in COVID-19 cases, except for those working in industries that provide essential needs. How might this impact the nation’s productivity, and what can the government do in response?
1. Why are persistent budget deficits worrisome? - Deficits can lead to private investment spending being crowded out. - Debt places an increased burden on the economy in the future. - The likelihood of default increases. - All of the above.
Topic-the budget balance in Carpathia 1) assume the budget balance, and Carpathia changes from a positive negative water effects with this have an investment spending in Carpathia? 2) assume that while the budget bound of capacity is from positive negative info capacity also decreases what impact will have on private investment spending in Carpathia? (included the data for the economy of carpathia as well as the GDP ,the national savings , capital inflow , the savings investment spending identity for the carpathian economy I do not know if this involves a formula or this involves a word problem please help
14. Suppose that Korea has been in recession and many economists have concerns about the long-term recession. Therefore, the Bank of Korea and the government are preparing stimulus packages for the economy. (1) Using both AA and DD curves, describe the effect of the government’s temporarily expansionary fiscal policy on the change of equilibrium of national output and foreign exchange rate. (2) The Korean government decides to annually spend an extra budget on constructing and maintaining social infrastructure forever. Using both AA and DD curves, describe the impact of the government’s policy on the change of equilibrium of national output and foreign exchange rate.
5 Which one of the following statements regarding fiscal policy and the budget is correct?(a) When the government plans to stimulate economic activity, it can increasespending or reduce taxes;(b) Revenue from tax is always greater than government spending in SouthAfrica;(c) Demand management only refers to fiscal policy;(d) A contractionary fiscal policy should be implemented to combatunemployment
QUESTION 7 07. What factors make an expansionary "stimulus" fiscal policy effective? a) A government budget deficit associated with fiscal stimulus should should borrow money from those who spend less and save more, to those who spend more and save less. b) A permanent decrease in taxes is more effective in stimulating spending than a temporary one c) An increase in government purchases of goods and services should be temporary and should not permanently displace private spending d) The most expansionary way of financing the budget deficit associated with a fiscal stimulus policy is by the central bank expanding the quantity of money in circulation. e) Infrastructure investment belongs with long-term growth policy, but invariably makes a poor element in stimulus policy because such investment normally take a long time to implement. f) All the above.
Topic: Fiscal Policy 1. A government collects $0.35 on every new dollar of income. Of the remaining $0.65 of disposable income, 20% is spent on imports, and 10% of the disposable income is saved. a. What is the marginal propensity to withdraw?b. How much of each new dollar of income is spent on domestic consumption?c. What is the spending multiplier in this economy?
Suppose the GDP of a country with a closed economy is $22 trillion, (net) taxes are $4.2 trillion, public saving is $0.8 trillion, and private saving is $1.3 trillion. What are the values of consumption, investment, national saving, and government spending? 1b Is the government of this country running a budget surplus or a deficit?