If the multiplier is 5 and investment increases by $3 billion, equilibrium real GDP will increase by: Select one: a $2 billion b. $8 billion. C$is billion. d. $3 billion
Q: If GDP is $3,400 billion, the multiplier is 5, and I rises by 15, what is the new level of GDP? The…
A: GDP is the value of final goods and services produced in the economy within a given period of time.
Q: Assume the government cuts spending by Si billion and the marginal propensity to save was 0.1. a.…
A: Gross domestic product (GDP) is the total monetary value, or market value, of finished products and…
Q: Multiplier Effect a. During a recessionary gap, is the goal to increase or decrease the equilibrium…
A:
Q: Consider a 4-sector economy, the consumption spending is C = 500+0.75(Y-T), taxes are T = 10 + 0.2Y,…
A: "In a 4-sector economy, planned aggregate expenditure as represented by PAE is computed by adding…
Q: 1. The marginal propensity to consume is: A) the change in consumption divided by the change in…
A: Marginal Propensity to Consume is the proportion of the additional income that consumer spend on…
Q: Is the mpc in the multiplier .75? only because multiplier is 1/(1-mpc) which would make sense for…
A: In the original question, MPS has given by stating "average households will save 25 cents of every…
Q: Table 2 shows elements in the national income accounts of an economy. Assume the economy is…
A: C) The marginal propensity to consume: MPC=change in consumptionchange in income Change in…
Q: a. By how much will GDP change if firms increase their investment by $11 billion and the MPC is 0.8?…
A:
Q: Which of the following would be most likely to increase consumption spending? Select an answer and…
A:
Q: 1. Given the following information: C = 500 + 0.8 Yd, Ip = 300, G = 500, X = 500, T= 100 + 0.2 Y, M…
A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…
Q: An economy has a marginal propensity to consume of 0.5, and Y*, the income-expenditure equilibrium…
A: Since you have posted a question with multiple sub-parts, we will solve first three sub parts for…
Q: Calculate the Marginal Propensity to Consume and the Marginal Propensity to Save. Fill in the blanks…
A: Saving(S)If nation income (Y) is $9,000 and the consumption (C) is $8,000, then the saving (s) can…
Q: 4. (a) If an initial increase in investment of $3 billion results in a $4.5 billion increase in…
A: The data presented in the question above is:- Increase in Investment = $3 billion Increase in…
Q: What is the value of marginal propensity to consume (mpc)? What does it mean?
A: In economics, consumption function states the functional relationship between total consumption and…
Q: 1. Using the above information, what is the MPC and MPS when the DI is 3000? MPC = MPS = 2. What…
A: here we can find the MPC and MPS and the change in income by using the disposable income which are…
Q: If an increase in investment spending of $20 million results in a $200 million increase in…
A: An investment is an asset or item acquired for the purpose of generating income or valuation. The…
Q: If Guy Barnes receives $1,000 from his newly created government job and gives $900 to Jingles…
A:
Q: In the economy of Spendsalot, the marginal propensity to save, MPS, is 0.8. What is the marginal…
A: Marginal propensity to save is the proportion of income saved.
Q: 5) If an increase in investment spending of $50 million results in a $400 million increase in…
A: Multiplier shows the change in the one factor to a change in the other related factors. It shows the…
Q: a)What will the multiplier be given the MPS values below? Fill in the table with your answers.…
A: Multiplier can be calculated by using the formula given below:
Q: Suppose an initial increase in government spending (G) increased GDP by $50,000. If he simple…
A: The size of government-spending multiplier(k) is the ratio of change(∆) in income(Y) to the…
Q: Suppose a private closed economy has an MPC of 0.7 and a current equilibrium GDP of $100 billion. a.…
A: Given- MPC=0.7 equlibrium GDP = $100 Billion
Q: Assume an economy where spending for each sector is: Household: C = 800 +0.95Qd Business: I=3000…
A: Hello, thank you for the question. Since there are many subparts in the question, only the first…
Q: 2. In a closed economy with no government, a $1 billion increase in initial spending leads to a $5…
A: Given: Increase in total spending-$1 billion Increase in total income-$5 billion
Q: A firm spends an additional £150 million on investment projects in 2012. How will this impact the…
A: Gross Domestic Product (GDP) refers to the value of final goods and services produced within the…
Q: 7. The marginal propensity to save is 0.15, the marginal propensity to consume:
A: GIVEN The marginal propensity to save is 0.15 the marginal propensity to consume:
Q: An Economy has no imports or taxes, the MPC is 0.90 and real GDP is $12 trillion. If businesses…
A: Answer: Given values: MPC(marginal propensity to consume)=0.90GDP=$12 trillionIncrease in business…
Q: a. What will the multiplier be given the MPS values below? Fill in the table with your answers. MPS…
A: A factor that, when being changed or increased leads to a change or increases in many other economic…
Q: QUESTION 4 The figure below shows the planned Aggregate Expenditure function for a hypothetical…
A: The aggregate expenditure function is AEp=1000+0.5Y This is ex-ante or planned expenditure. The GDP…
Q: a.What is the multiplier? b.What is the equilibrium level of the real GDP? c.What is the value of…
A: The multiplier is a factor which is concerned with the proportionality, the response change in the…
Q: Question 161 'yui C+1+ (X- IM) -C+L+(X- IM) 120 200 Real GDP 600 If the level of investment spending…
A: Here, the given graph shows the intersection of aggregate expenditure and aggregate output in the…
Q: 5. If the multiplier is 5 and investment increases by $3 billion, equilibrium real GDP will increase…
A: Hi! thankyou for the question but as per the guidelines, we answer one question at one time. Kindly…
Q: When real GDP is zero, investment is $2.0 trillion, government expenditure is $1.5 trillion, exports…
A:
Q: The greater the MPC, Select one: a. the greater the expenditure multiplier b. there will be no…
A: (1) MPC stands for marginal propensity to consume. Expenditure multiplier = 1 / (1 -MPC) --------…
Q: a) The accompanying table shows gross domestic product (GDP), disposable income (YD), consumer…
A: a) GDP YD C I planned AEplanned Iunplanned (billions…
Q: 3. For a closed economy, the following data is given: 50 + 0.8Y, Consumption C %3D Investment I 70…
A:
Q: in an imaginary economy, there is no foreign trade and no government activity. APC = MPC = 0.08. In…
A: GDP refers to the total value of finished goods and services that produced within the economic…
Q: In an economy with no government and no foreign sectors, autonomous consumer spending is $250…
A: The income-expenditure equilibrium occurs when the aggregate quantity demanded by the key sectors…
Q: Assume a closed economy in which disposable income starts at 1,000 and increases by 500; consumption…
A: GDP is the value of final goods and services produced in the economy within a given period of time.
Q: multiplier? 3. Draw a graph representing a hypothetical economy. Carefully label the two axes, the S…
A: Injections add to the circular flow of income in the economy whereas leakages decrease from the…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Consider a 4-sector economy, the consumption spending is C = 500+0.75(Y-T), taxes are T = 10 + 0.2Y, and imports are M=0.2Y. Planned investment is Ip=300, government spending is G=250, and exports are X=10. What is the slope of the planned aggregate expenditure (PAE) line? a) 0.7 b) 0.5 c) 0.6 d) 0.3 e) 0.4Is the mpc in the multiplier .75? only because multiplier is 1/(1-mpc) which would make sense for .25 1-.75=.25 however what is mps?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).
- 4. Assume a closed economy in which disposable income starts at 1,000 and increases by 500; consumption starts at 1,100 and increases by 300; investment spending is 1,000 and government spending is 500. The MPC is 0.6, The multiplier is 2.5, and The consumption equation is C = 500 + 0.6DI Equilibrium GDP is? A 3,500 B 3,000 C 4,000 D 5,000Y C I G X $ 100 $ 120 $ 20 $ 30 $ 10 $ 300 $ 300 $ 20 $ 30 - $ 10 $ 500 $ 480 $ 20 $ 30 - $ 30 $ 700 $ 660 $ 20 $ 30 - $ 50 a.What is the multiplier? b.What is the equilibrium level of the real GDP? c.What is the value of autonomous consumption?1. In using the expenditure approach to GDP, consumption.... 2.The long -run aggregate supply curve is ? 3. National saving equals private saving plus government saving ,which inturn equals? 4. The mpc and mps measures charges in consumption expenditure and saving that result from changes in ? 5. The sum of the components aggregate expenditure that are not influence by real GDP is called ?
- 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).Income and Expenditure — End of Chapter Problem An economy has a marginal propensity to consume of 0.5, and Y*, the income-expenditure equilibrium GDP, equals $500 billion. Given an autonomous increase in planned investment of $10 billion, answer the following questions. a. What is the value of the multiplier? Value of the multiplier = b. What would you expect the total change in Y* to be based on the multiplier formula? Change in Y* based on the multiplier = billion c. What is the total change in real GDP after the 10 rounds? It may be beneficial to make a table on a separate sheet of paper to calculate the change in real GDP for each of the rounds, and then add up the values. Total change in real GDP (10 rounds) = billion d. How do your answers to the change in GDP and Y compare? The answer to total change in GDP after 10 rounds and the change in Y* based on the multiplier formula arePlease calculate level of GDP in equilibrium, consumption and savings level if you know that: I (investment) = 300 Ca (Autonomous Consumption) = 100 MPS (Marginal Propensity to Save) = 0,1 G (Government Expenditures) = 300 T (net taxe rate) = 0,2
- 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?Assume a closed economy in which, there is no government. If ouput (income) is 800,autonomous consumption is 100, and marginal propensity to consume is 0.70 in this economy.Then calculate the the amount of consumption spending?In order for the economy (GDP) to be grow and take advantage of the multiplier effect, which one of these should be done? a. Increase agricultural production b. Increase taxes c. Increase the number of banks nationwide d. increase the manufacturing sector e. Increase government spending f. all of the choices