Homework Help is Here – Start Your Trial Now!
Business
Economics
Assume the Ghanaian economy is closed (thus where there is no export and imports) with the information below. C= 400+ 0.8Yd Where Yd=(Y-T) I= 150 G=250 T= 200 a) Explain the concepts of marginal propensity to consume(MPC) and marginal propensity to save(MPS) What is the MPC and MPS for this economy? Explain the concepts of the autonomous spending and tax multipliers.

Assume the Ghanaian economy is closed (thus where there is no export and imports) with the information below. C= 400+ 0.8Yd Where Yd=(Y-T) I= 150 G=250 T= 200 a) Explain the concepts of marginal propensity to consume(MPC) and marginal propensity to save(MPS) What is the MPC and MPS for this economy? Explain the concepts of the autonomous spending and tax multipliers.

Survey Of Economics
Survey Of Economics
10th Edition
ISBN:9781337111522
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter15: Fiscal Policy
Section: Chapter Questions
Problem 6SQ
See similar textbooks
icon
Related questions
Question
Assume the Ghanaian economy is closed (thus where there is no export and imports) with the information below. C= 400+ 0.8Yd Where Y (Y-T) I= 150 G= 250 T= 200 a) Explain the concepts of marginal propensity to consume(MPC) and marginal propensity to save(MPS) b) What is the MPC and MPS for this economy? c) Explain the concepts of the autonomous spending and tax multipliers. d) What is the autonomous spending multiplier for this economy? e) What is the tax multiplier for this economy? f) What is the equilibrium level of income for this economy? g) Suppose that the full employment level of output for this economy is 2000. h) What sort of output gap is Ghana facing? i) Present the gap in a well labelled diagram j) What kind of policy can the government use to close this kind of gap?
Transcribed Image Text:Assume the Ghanaian economy is closed (thus where there is no export and imports) with the information below. C= 400+ 0.8Yd Where Y (Y-T) I= 150 G= 250 T= 200 a) Explain the concepts of marginal propensity to consume(MPC) and marginal propensity to save(MPS) b) What is the MPC and MPS for this economy? c) Explain the concepts of the autonomous spending and tax multipliers. d) What is the autonomous spending multiplier for this economy? e) What is the tax multiplier for this economy? f) What is the equilibrium level of income for this economy? g) Suppose that the full employment level of output for this economy is 2000. h) What sort of output gap is Ghana facing? i) Present the gap in a well labelled diagram j) What kind of policy can the government use to close this kind of gap?
Expert Solution
steps

Step by step

Solved in 2 steps with 1 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Aggregate Expenditure Schedule
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Recommended textbooks for you
Survey Of Economics
Survey Of Economics
Economics
ISBN:
9781337111522
Author:
Tucker, Irvin B.
Publisher:
Cengage,
Economics For Today
Economics For Today
Economics
ISBN:
9781337613040
Author:
Tucker
Publisher:
Cengage Learning
MACROECONOMICS FOR TODAY
MACROECONOMICS FOR TODAY
Economics
ISBN:
9781337613057
Author:
Tucker
Publisher:
CENGAGE L
MACROECONOMICS
MACROECONOMICS
Economics
ISBN:
9781337794985
Author:
Baumol
Publisher:
CENGAGE L
Economics (MindTap Course List)
Economics (MindTap Course List)
Economics
ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning
Macroeconomics
Macroeconomics
Economics
ISBN:
9781337617390
Author:
Roger A. Arnold
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS