Answered: Comment with the help of example and…

Business

Economics

Comment with the help of example and graphically as wel

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter4: The Aggregate Economy

Section: Chapter Questions

Problem 6E

See similar textbooks

Related questions

Q: Given the following: Ca = $450, Ig = $250, Xn = − $10, and G = $30, what is the economy’s…

A: Equilibrium GDP is given by the aggregate of Consumption, Investment, Government Expenditure.

Q: In order to find 2016 GDP in chained 2017 dollars, you would need to compute all but one of the…

A: In order to calculate the 2016 GDP in chained 2017 dollars, the GDP for 2016 in current year prices,…

Q: Which statement below is false regarding the circular flow diagram? It depicts interaction…

A: In a circular flow diagram major exchanges in an economy are represented as flow of money, goods and…

Q: In a two-sector economy, Aggregate Expenditure (AE) equals

A: Since you have asked multiple questions, we will answer the first question for you. If you want any…

Q: d. In Crusoe’s final year on the island, he produces the same as in every other year (he’s a…

A: d. As always, GDP is £4,400. But now C 5 £4007, I 5 £400, and X 5 2£7.Note that all of the washed-up…

Q: If a Japanese tourist drinks German beer in a hotel in New York City, how will the U.S. GDP be…

A: GDP quantifies the monetary worth of final products and services produced in a nation over a…

Q: If aggregate expenditures are equal to 15,000, and GDP is 20,000, then unplanned investment is…

A: At equilibrium, Aggregate expenditure is equal to GDP. That means planned expenditure equal to GDP.…

Q: Thoroughly explain the components of GDP and relate those components to the Circular Flow model with…

A: The components of GDP are:1. Consumption expenditure2. Investment expenditure3. Government…

Q: Answer the following questions: Instructions: Enter your answers rounded to the nearest whole…

A: Given : MPC = 0.9 Increase in investment by $11 billion

Q: nsider the economic model: Yt Ct +i %3D Ct myt-1 it act-1 here y is GDP, c is consumption, i is…

A: Gross domestic product (GDP) is the standard measure of the value added created through the…

Q: Which of the following will not cause an increase in equilibrium GDP? a) an increase in government…

A: According to the expenditure approach of calculating national income, Y= C+I+G+NX C is the domestic…

Q: Why do economists and managers pay attention to the measurements of macroeconomic activity? several…

A: Answer - Economist and managers pay attention to many measurment of macroeconomics activity " GDP…

Q: Refer to the information provided in Table below to answer the question. Aggregate Income ($…

A: Economics as a subject deals with the allocation of scarce resources among humans with unlimited…

Q: What is the importance of this macroeconomic (GDP) indicator? Is it also important for Qatar?

A: 1a) Gross domestic product is important on the grounds that it gives data about the size of the…

Q: When the Japanese car maker Toyota expands one ofits car factories in the United States, what is the…

A: Gross domestic product (GDP) is the total value of goods and services produced in a country during a…

Q: Fluctuation of savings and investment rates impact on GDP of any macroeconomics. Comment with the…

A: GDP or the gross domestic product is the value of all the final goods and services which are newly…

Q: how the US GDP has performed from January 2017 to August 2021. (i) Excluding COVID-19 reason,…

Q: Consumption $500 Government Expenditures $200 GNP $800 Gross Private Domestic Investment $100…

A: Given that, Consumption = $500Government Expenditures = $200GNP = $800Gross Private Domestic…

Q: How do each of the following transactions affect Canada’s GDP? Unless otherwise indicated, assume…

A: Gross Domestic Product is the sum total of market value of final goods and services produced in a…

Q: The national income model for an economy is represented as follows (units are in Ksh.M) Y = C + I +…

A: (Q)The national income model for an economy is represented as follows (units are in Ksh.M) Y = C + I…

Q: If disposable income rises, then GDP rises as well. * True False

A: Macroeconomics is an area of economics that is used to understand how efficiently a policymaker can…

Q: Find equilibrium GDP using the following macroeconomic model (the numbers, with the exception of the…

A: The economy is at equilibrium when the aggregate supply is equal to aggregate demand. Equilibrium…

Q: Given the following: Ca = $100, Ig = $50, Xn = − $10, and G = $30, what is the economy’s equilibrium…

A: GDP = C + I + G + NX C - Consumption I - Investment G - Government expenditure NX - Net export…

Q: In the above table, C is consumption expenditure, / is investment, G is government expenditure, X is…

A: Real GDP C I G X M 100 75 25 95 10 1 200 150 25 95 10 2 300 225 25 95 10 3 400 300 25 95 10…

Q: 3. Fill in the blanks in the following table and determine the equilibrium level of real GDP.…

A: GDP is the sum of market value of final goods and services produced within the geographical borders…

Q: For a country, we have given the following figures for different variables for the year 2016 and…

A: Hi! thanks for the question but as per the guidelines, we can answer up to 3 sub-parts at one time.…

Q: When real GDP lies above potential GDP, what typė of experienced? (One word answer)

A: Gross domestic product (GDP): - GDP is the market value of all final goods and services produced in…

Q: Which component of GDP will increase if disposable income increases

A: The Gross Domestic Product (GDP) measures the market value of all the final goods and services…

Q: Given the following: Ca = $100, Ig = $50, Xn = − $10, and G = $30, what is the economy’s equilibrium…

A: GDP = C + I + G + NX C - Consumption I - Investment G - Government expenditure NX - Net export…

Q: Explain the differences between actual GDP and potential GDP and support your answer by graph.

A: Potential GDP measures the value of production of goods and services that an economy is capable to…

Q: Which of the following best describes aggregate expenditure? O a. C+I+G+(X+ M) O b.C+I+T+ (X+ M) Oc.…

A: Aggregate expenditure is a sum total of all expenditures in an economy. Usually, the expenditures in…

Q: If Full employment GDP is greater than equilibrium GDP, the economy is facing

A: Full employment GDP is the maximum level of GDP that can be attained in the long run. Equilibrium…

Q: Calculate the value of consumption expenditure from the following:- National income = $6000…

A: The information provided to us is as follows:- National income = $6000 Autonomous consumption =…

Q: h. Note that we have reset the Iplanned to 320. If autonomous consumer spending drops to $40 billion…

A: Introduction GDP, YD and AE of a country will be same. This is the total income of a country. Table…

Q: a given year, nominal GDP increased by about 2.5%. Over that year, the GDP deflator decreased by…

A: With nominal GDP increased by about 2.5 % and at the same time GDP deflator decreased by 4 %, then…

Q: Given the following, Ca = $500, Ig = $250, Xn = − $10, and G = $30, what is the economy’s…

A: GDP = Consumption + Investment + Government expenditure + net export

Q: C = 180 + 0.70YD |= 150 G = 190 T= 120 a.) Equilibrium GDP (Y) = (Round your response to two decimal…

A: The total amount of goods and services that produced in an economy in a given period of time is…

Q: Janet, a mother of two, decides to reduce her working hours to spend more time with her children. By…

A: National GDP represents the aggregate services and goods produced in the economy in the given…

Q: Would a temporary investment tax credit for businesses or a temporary income tax cut for individuals…

A: Temporary income tax cut would influence GDP greatly.

Q: Which of the following will not cause an increase in equilibrium GDP? a) an increase in government…

A: GDP is the value of final goods and services produced in the economy within a given period of time.

Q: Hitomi is a Japanese tourist who spends $50,000 on her vacation in Alberta. (e) Ichabod purchases a…

A: D) GDP would increase by 50,000. Spending by Japanese tourist happens in Canada. So it would be…

Q: Modern Principles of Economics Fourth Edition Question 17 PLEASE ANSWER PART D AND E Let’s figure…

A: "Since you have asked multiple questions,we will solve first question for you.If you want any…

Q: Find equilibrium GDP using the following macroeconomic model (the numbers, with the exception of the…

A: Given:C=1,250+0.80Y I=1,250 G=2,000 NX=-500

Q: Q2 In each of the following cases, determine the effect of each case on GDP and its components in…

A: We know that Aggregate Demand is the sum total of consumption expenditure, investment expenditure,…

Q: Suppose that an auto company owned entirely by US citizens opens a new factory in Canada. a) What…

A: GDP and GNP are measures used to assess the health of the economy. Its often used to compare the…

Q: For the following question , please indicate whether current GDP of the United States will be…

A: GDP is sum of value of all goods and services produced in the nation at a given period of time.

Q: If the United States introduces universal child care, what will likely happen to GDP? Explain fully…

A: Universal child care is the provision of child care facilities like health care, education,…

Concept explainers

Economic Growth

It means the rise in the manufacturing levels of a country’s products/services over a while. It is calculated in terms of the real income of the people of the country. When the production of products/services begins, the manufacturers will hire employees, which in turn raises the income of the people and it will also raise the buying power, this eventually leads to the circulation of money that directly helps in the increase in the Gross Domestic Product (GDP). Thus, GDP is calculated by economists to calculate the growth in the country.

Question

Fluctuation of savings and investment rates impact on GDP of any macroeconomics. Comment with the help of example and graphically as wel

Branch of economics that analyzes the behavior and performance of an economy as a whole. It focuses on the study of aggregates and evaluates changes related to unemployment, gross domestic product, inflation, monetary and fiscal policies of the government.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Step by step

Solved in 3 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

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.

Similar questions

Explain briefly whether each of the following would cause GDP to overstate or understate the degree of change in the broad standard of living. The environment becomes dirtier The crime rate declines A greater variety of goods become available to consumers Infant mortality declines
Fluctuation of savings and investment rates impact on GDP of any macroeconomics. Comment with the help of example and graphically as well
For the following question , please indicate whether current GDP of the United States will be affected and, if so, by how much .In each case, indicate also which component(s) of GDP will be affected and by how much This month, a manufacturer in colorado sells $60,000 worth of t-shirts to a distributor in New York City, who sells them to the public. Then the New York distributor buys corporate bonds for a value of $10,,000, which promise to return $9400 one year from now.
In this question, In Country 1, the values of the aggregate variables in 2020 are given as follows: Country 1 (in 2022) Variable Value Consumption 1227 investments 800 Government expenditures: 500 Exports: 150 Imports: 550 What is the GDP of Country 1 in 2022? Only Typing answer I need ASAP
Consumption $500Government Expenditures $200GNP $800Gross Private Domestic Investment $100Imports $100Exports $50 Questions: 3. Using the data above, PCE (Personal Consumption Expenditure) is equal to _____________.4. If the dollar amounts of the items above are the nominal amounts in year 2017, and the quantities of units are identical in years 2010 and 2017, but prices in 2010 were 20% less than 2017, Real GDP in 2017 using 2010 as the base year is equal to _______________.
Q-1. when is a country said to move into a recession? Select one: a. If actual output falls below the trend level of output b If actual output falls below the potential level of output c. If actual output falls for two consecutive quarters of a year d If actual output falls Q-2. The equation for GDP using the expenditure approach is Select one: a. GDP=C+I+G +( IM-EX). b. GDP=C+I+G-EX-IM c. GDP=C+I+G+ (EX-IM) d. GDP=C+I+G + EX +IM. just give answerneed 100 percent perfect answer asap.
Why do economists and managers pay attention to the measurements of macroeconomic activity? several elements of these measurements such as durable goods, non-durable goods, etc
In order to find 2016 GDP in chained 2017 dollars, you would need to compute all but one of the following. Which is unnecessary? Hints: (1) start by writing an equation to show how 2016 GDP is related to 2017 GDP (in chained 2017 dollars). If you are not sure how to do this, go back to the lecture slides or to the reading "Numerical Example of Chain Weighting." (2) in the answers below, the phrase "in constant [year] dollars" refers to a fixed-weight calculation. a) current-dollar GDP in 2017 b) 2017 GDP in constant 2016 dollars c) 2016 GDP in constant 2015 dollars d) current-dollar GDP in 2016 e) 2016 GDP in constant 2017 dollars
Please provide me ans for part f only. Q) Assume a hypothetical economy that produces only one good – Peanut Butter. In year 1, the quantity produced is 4 packs and the price is Rs.400 per pack. In year 2, the quantity produced is 5 packs and the price is Rs.500 per pack. In year 3, the quantity produced is 6 packs and the price is Rs.600 per pack. Year 1 is the base year.a. What is nominal GDP for each of these three years? b. What is real GDP for each of these years? c. What is the GDP deflator for each of these years? d. What is the percentage growth rate of real GDP from year 2 to year 3? e. What is the inflation rate as measured by the GDP deflator from year 2 to year 3? f. In this one-good economy, how might you have answered parts (d) and (e) without first answering parts (b) and (c)?
How shares of GDP accounted for by each component of GDP (C, I, G, X, and M) have changed across these three dates. Any trends? Any large changes? Be specific. 1968Q4 2000Q1 2023Q1 Consumption 59% 66% 68% Investment 17% 20% 17% Government Purchases 24% 18% 18% Exports 5% 11% 11% Imports -5% -14% -15%
So far, we have learned to measure real GDP, but how do we end up with that real GDP? Of all of the different amountsof national income and price levels that might exist, how do we gravitate toward the one that gets measured each year asreal GDP?In short, it is the interaction of the buyers and producers of all output that determines both the national income (real GDP)and the price level. In other words, the intersection of aggregate demand (AD) and short-run aggregate supply (SRAS)determines the short-run equilibrium output and price level.Once we have a short-run equilibrium output, we can then compare it to the full employment output to figure out where inthe business cycle we are. If current real GDP is less than full employment output, an economy is in a recession. If currentreal GDP is higher than full employment output, an economy is experiencing a boom. If the current output is equal to thefull-employment output, then we say that the economy is in long-run equilibrium. The…
Knowing that: The formula for economic impact is I(r)=(A)/1-r ---(i) The formula for impact change is ∆I= I'(r)*∆r ---(ii) The formula for percentage change in spending is g(r)=(r)/1-r ---(iii)