Consumption function C = 32 +0.8 Y. a. Create saving function b. How much is consumption when saving = 0 c. How much income when the savings are 20
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A: * SOLUTION :- From the given information the calculation is given as ,
Consumption function C = 32 +0.8 Y.
a. Create saving function
b. How much is consumption when saving = 0
c. How much income when the savings are 20
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Solved in 4 steps
- State 3 characteristic of the consumption function ?If Evan's income is reduced to zero after he loses his job, his consumption will be ________ and his saving will be ________. a.greater than zero; less than zero b.greater than zero; greater than zero c.less than zero; greater than zero d.less than zero; less than zeroI consumed all my income at every level of income.Draw my consumption and saving function.What are my MPC and MPS? Explain why it must always be true that MPC+MPS equal to 1?
- Which of the following situations represents investment? Saving? ExplainYour family takes out a mortgage and buys a new house. You use your paycheque to buy stock in Sagicor Financial Services.Assume an intertemporal budget constraint that shows how consumption can be traded off between two periods, t and t+1. Assume the consumer can save and borrow at the same interest rate of 10%. Assume the consumer collects income of $100 in each period. To gain an extra $10 dollars in period t+1, what must the consumer give up in period t?Assume the following consumption schedule: C = 20 + 0.9Y, where C is consumption and Y is disposable income. At a(n) $1,000 level of disposable income, the level of saving is $80. $920. $180. $18.
- Question 4 : Refer to the information provided in table below to answer the questions that follow. Y C S 0 100 180 190 a. Find the consumption, if the consumption function is: C= 120 +0.2Y. b. Find aggregate saving. c. Illustrate that by graph from the information provided in table.What is the level of saving if: The MPC equals .9, disposable income rises from $ 800 to $ 900, and saving is originally $ 120 when income equals $ 800?Consider an economy described by the following equations:Y = C + I + GY = 5,000G = 1,000T = 1,000C = 250 + 0.75(Y −T )I = 1,000 − 50 r.a. In this economy, compute private saving, public saving, and national saving. b. Find the equilibrium interest rate. c. Now suppose that G rises to 1,250. Compute private saving, public saving, and national saving.
- Suppose that the linear equation for consumption in a hypothetical economy is C = 40 + .8Y. Also suppose that income (Y ) is $400. Determine (a) the marginal propensity to consume, (b) the marginal propensity to save, (c) the level of consumption, (d ) the average propensity to consume, (e) the level of saving, and ( f ) the average propensity to save.Assume that the consumption function is given by C = 500 + 0.75 (Y − T). If income increases by 100, then saving will increase byRefer to the information provided in Table Below to answer the questions that follow Y C S 0 50 -50 50 60 -10 75 65 10 100 70 30 120 74 46 140 78 62 160 82 78 1- If the Consumption Function is C= 50+0.2Y 2- Find the consumption and the saving for this economy. 3- Illustrate by graph the consumption function.
