b. What will the multiplier be given the MPC values below? Fill in the table with your answers. Instructions: Round your answers to 2 decimal places. MPC Multiplier 1.0 0.9 0.75 0.5 c. How much of a change in GDP will result if firms increase their level of investment by $8 billion and the MPC is 0.80? Instructions: Enter your answers as whole numbers. billion

b. What will the multiplier be given the MPC values below? Fill in the table with your answers. Instructions: Round your answers to 2 decimal places. MPC Multiplier 1.0 0.9 0.75 0.5 c. How much of a change in GDP will result if firms increase their level of investment by $8 billion and the MPC is 0.80? Instructions: Enter your answers as whole numbers. billion

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter9: Aggregate Demand

Section: Chapter Questions

Problem 5.10P

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Similar questions

a)What will the multiplier be given the MPS values below? Fill in the table with your answers. Instructions: round your answers to 2 decimal places. MPS Multiplier 0.0 0.4 0.5 1.0 b) What will the multiplier be given the MPC values below? Fill in the table with your anwers. MPC Multiplier 1.0 0.9 0.75 0.5 0 c) How much of a change in GDP will result if firms increase their level of investment by $ 8 billion and the MPC is 0.80? ( Enter your answers as whole numbers) How much of a change in GDP will result if firms incresese their level of investment by $ 8 billion and the MPC instead is 0.67?
a. What is the value of the MPC?b. WhatisthevalueoftheMPS?c. What is the value of the multiplier?d. What is the amount of unplanned investment at aggregate output of 300, 900, and 1,300?
Table 2 shows elements in the national income accounts of an economy. Assume the economy is currently in equilibrium. elements billions Consumption (total) 80 Investment 9 Government Expenditure. 6 Imports 15 Exports 8 C) If national income now rises by £22 billion and as a result, the consumption of domestically produced goods rises to £80 billion. Calculate the marginal propensity to consume (MPC). D) What is the value of the multiplier? E) Comment on the results in part (c) and (d).
in an imaginary economy, there is no foreign trade and no government activity. APC = MPC = 0.08. In equilibrium, consumption expenditure is Rs,20, 000 Million. (a) What is ihe level of invesiment expenditure? (b) What is the value of the multiplier (c) Suppose investment spending remains unchanged but both APC and MPC fall to 0.06, what is the new equilibrium level of national income?
Given Co = 400 and MPC=0.70 Does MPS + MPC = 1? If autonomous consumption increases by $50. What is the multiplier? What is the change in total spending? Use a diagram to show which curve shifts and how.
Given an economy is currently producing at $1.47 GDP, natural rGDP is $1.67, and the MPC is 0.94, then the multiplier for increases in aggregate expenditures is: A (round to ane decimal point). This means the federal government should increase its expenditures by A (whole number) billion dollars.
If C = 150 + .6Y and I = 50 then a. how much is autonomous consumption,MPC,MPS,Equilibrium level,investiment multiplier b. If investment increases by 50, using the multiplier you found above what will be the change in Y? What will be the new Y (Y2)?
Initital $10 increase in investment expands GDP by $10 in first round of multiplier process. the 2nd round both GDP and Consumption rise $6. 1. what is the Marginal Propensity to Consume? 2. What is the size of the mulitplyer?
Suppose that disposable income, consumptio, and saving in some country are $ 200 billion, $ 150 billion, and $ 50 billion respectively. Next, assume that disposobal income increase by $ 20 billion, consumption rises by $ 18 billion, and saving goes up by $ 2 billion. a) What is the economy's MPC? What is its MPS? Instructions: Round your answers to 1 decimal place. b) What was the APC before the increase in disposable income? Instructions: Round your answer to 2 decimal places. What was the APC after the increase. ( round your answer to 3 decimal places).
We again assume asimple closed economy with GDP of 100 and:c0(autonomous consumption) = 20c1 (marginal propensity to consume) = 0.6I (investment) = 20.a) Now assume that c0falls by 5 (i.e. 5% of GDP), i.e. for any given level of output,consumption will fall by 5. Show the implied fall in the AD function in yourdiagram and show that output will fall by more than 5.b) Show that the multiplier is equal to 2.5, and hence that, in the new equilibrium,output will have fallen by 12.5 (i.e. by 12.5%)c) How big would the impact be if, say, c1 = 0.4 or c1 = 0.8? Explain the difference.
What will the multiplier be when the MPS is 0, 0.4, 0.6, and 1? What will it be when MPC is 1, 0.90, 0.67, 0.50, and 0? How much of a change in GDP will result if firms increase their level of investment by 8 billion and the MPC is 0.80? If the MPC instead of 0.67?
a) Given Co = 400 and MPC = 0.70. Find Consumption when Yd = 2000 and when Yd = 3000. b) Given the consumption levels you found in part a), calculate Savings for both these levels of disposable income and consumption c) Calculate MPS d) Prove that MPS + MPC = 1 e) If autonomous consumption increases by $50. What is the multiplier? What is the change in total spending? f) Draw a diagram to show the effect of the multiplier in the economy? [Hint: What shifts and how?] Kindly answer this question correctly and type the answer here. Don’t give a handwritten answer on a page. And please answer it in 15 minutes. I will give you a thumbs up.