Q: in 2019 fiscal year estimated that Ghanaians saved 20 percent of their disposable income; however,…
A: Economy is in equilibrium where Aggregate Expenditure = Aggregate Income . AE = C + I + (G-T)…
Q: During the 2012 fiscal year, households in an economy spent 80 per cent of their disposable income…
A: Introduction We have given data of a economy of the fiscal year 2012. We have to calculate the…
Q: We use the following terminology in this part: aggregate income Y and disposable income Ya (= Y –T),…
A: The aggregate expenditure (AE) is the total expenditure by the economy. In other words, it is also…
Q: (i)Calculate the national income equilibrium. (ii)Based on your answer…
A: The aggregate expenditure is the summation of total expenditure in an economy during a particular…
Q: (b) Assume that a three-sector economy in Country W. The amount of autonomous consumption is RM300…
A: GDP refers to the total value of finished goods and services that produced within the economic…
Q: Analyse the effect on equilibrium national income if the MPC falls from 0.95 to 0.4. Illustrate with…
A: National income is an income that is generated by summing the consumption, government expenditure,…
Q: Assume the MPC is 0.8. If government were to impose $20 billion of new taxes on household income,…
A: Given MPC = 0.8 New taxes imposed = $20 billion
Q: If the expenditure multiplier is 2.5 and the government spending increases by $4 billion, what would…
A: Given: Expenditure multiplier = 2.5 Government spending = $4 billion
Q: ASSUME THAT A THREE SECTOR ECONOMY IN COUNTRY W. THE AMOUNT OF AUTONOMOUS CONSUMPTION IS RM 300…
A: Aggregate demand is given by the aggregate of consumption, investment, and government expenditure.
Q: Assuming you are the Minister of Finance and Economic Planning for Nigeria, in charge of Fiscal…
A: Given information MPS=0.20 Autonomous consumption=5000 Investment=7000 G=8000 T=2000 t=0.25…
Q: Suppose the interest on the debt was $700 billion. If interest is paid domestically, 90% will be…
A: Given: The total debt of the country is given as $700 billion 100% interest is paid domestically…
Q: If the marginal propensity to save is 0.4 (or 40%) and the government plans to spend $4,000 in the…
A: Given MPS = 0.4 Increase in government spending = 4000 $ Expenditure multiplier = 1 / MPS = 2.5
Q: We use the following terminology in this part: aggregate income Y and disposable income Ya (= Y –T),…
A:
Q: Which of the following is a leakage from the circular flow of income and expenditure in South…
A: Leakage is something which lowers the income across the economy (outflow of income) and injection is…
Q: The Break-even point also becomes the national income equilibrium point when: Saving = zero.…
A: Actually in easy word we can say that the break even point denotes the amount of the actual revenue…
Q: Given that: The government expenditure G = 40, the investment I = 60 the consumption C=(0.75)Ya+10,…
A: National income is equal to the sum of expenditures incurred by various sectors of the economy in…
Q: Given that G= 20 1= 35 C = 0.9Ya + 70 T= 0.2Y + 25 Where, G, I, C, T and Ya are planned government…
A: Aggregate expenditure is the sum of consumption spending, investment spending and government…
Q: Autonomous Consumption R535m Marginal propensity to consume is 0.75 Investment Spending R322m…
A: For the question asked there are certain terms given to data which are:- Government Spending=G…
Q: Consider an economy similar to that in the preceding question in which investment is also $200,…
A: GDP refers to the total value of all the final good and services that produced within the economy…
Q: Equilibrium output is 1000, MPC is 1/2 and taxes are zero. Government spending is 20 and net exports…
A: The income equation is given as Y = C+I+G+NX Here consumption is 1/2*Y= MPC which is 1/2*1000= 500…
Q: We use the following terminology in this part: aggregate income Y and disposable income Ya (= Y –T),…
A: Given: The hypothetical economy where: To Find: Th expression for the investment-saving (IS) curve:
Q: Real GDP C 177 170 163 142 250 240 230 200 100 I 54 54 54 54 72 54 The above table shows the real…
A: Equilibrium aggregate expenditure is occur when the Real GDP is equals to Aggregate expenditure so…
Q: A) What is the current equilibrium level of income? B) What is the level of injections? What is the…
A: In this question:- Consumption(C) =£ 70 billions Investment(I)=£ 6 billions Government…
Q: Which one of the following pairs of points coincide O The Break-even point and the national income…
A: The equilibrium point is the stable state where all the forces are equal, balanced and in stable…
Q: Determine aggregate expenditures (AE) in this economy when real GDP (Y) is equal to $1,500 billion,…
A: The aggregate expenditure refers to the amount of the money spent on the consumption, investment,…
Q: Autonomous Consumption R535m Marginal propensity to consume is 0.75 Investment Spending R322m…
A: C=C0+cYd C=Consumption C0=Autonomous Consumption C=Marginal propensity to consume Yd=Disposable…
Q: Assume that a three-sector economy in Country W. The amount of autonomous consumption is RM300…
A: In the income-expenditure model, the equilibrium occurs at the level of GDP where aggregate…
Q: Autonomous Consumption R535m Marginal propensity to consume is 0.75 Investment Spending R322m…
A: Formula to get equilibrium output is Y = C + I + G + X + M Where, C = Consumption I = Investment G =…
Q: (For students who were assigned Chapter 28) Use the aggregate expenditures model to show how…
A: Recessionary gap occurs when the actual real GDP is less than the potential real GDP. To close the…
Q: The country is experiencing a serious rise in inflation which the government wants to control…
A: Gross domestic product is the market value of all goods and services produced in the economy in a…
Q: You are given the following information about the Canadian economy: Autonomous consumption…
A: Since you have posted a question with multiple sub-parts, we will solve first three sub parts for…
Q: Find equilibrium level of national income from the following:- Autonomous consumption = $200 MPC…
A: The Given information is as follows:- Autonomous consumption = $200 MPC = 0.8 Investment = $100 We…
Q: Assume the following model of the expenditure sector: S=C+I+G+Nx TR=100 C=420+(4/5)YD I=160 G=180…
A: In the expenditure model, Y = C + I + G + NX , since the values are given: Y= 420 + (4/5)[Y –(1/6)Y…
Q: Incorrect Question 5 Suppose that national income is unchanged, taxes decrease, consumption remains…
A: Interest rates would decrease and money supply would increase because allready allready taxes have…
Q: Consider the following information about an economy. C=100+b(Y-50-0.25Y); I=50, G=50, X=10,…
A: Consider the following information about the economy. C=100+b(Y-50-0.25Y); I=50, G=50, X=10,…
Q: Equilibrium expenditure occurs where * The aggregate expenditure curve crosses the 45-degree line…
A: The point of intersection of total output i.e., 45' line and the planned expenditure is said to be…
Q: The current state in the economy are as follows; Autonomous Consumption: 9000, Marginal Propensity…
A: The aggregate expenditure curve is positively sloped and it starts from the point above the origin.…
Q: Autonomous consumption = R100m Investment spending = R300m Government spending = R200 million…
A: Autonomous Consumption = 100 Investment Spending = 300 Government Spending = 200 Exports = 150…
Q: We use the following terminology in this part: aggregate income Y and disposable income Ya (= Y –T),…
A: Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: Assume that a three-sector economy in Country W. The amount of autonomous consumption is RM300…
A: Equilibrium is the stable state where all the variables are balanced.
Q: One of the debates surrounding changes in government spending is its effect on the size of national…
A: The aggregate demand and aggregate supply determine the macroeconomic equilbrium in an economy.…
Q: Which one of the following pairs of points coincide(Li) : O The Break-even point and the national…
A: In economics, there are different ways to explain a specific situation because different theories…
Q: Assume that a three-sector economy in Country W. The amount of autonomous consumption is RM300…
A: The given information: Autonomous consumption=RM300+0.5Yd T=0.2Y I=RM 250 million G=RM150 Million
Q: Assume that a three-sector economy in Country W. The amount of autonomous consumption is RM300…
A: Given Information Autonomous consumption (C) = RM 300 million Marginal propensity to consume…
Q: Determine the change in the equilibrium level of consumption (find ΔC) following a decrease in…
A: Assume the economy is experiencing a recessionary hole because of deficient total demand. We can…
Q: During the 2012 fiscal year, households in an economy spent 80 per cent of their disposable income…
A: Since you have asked a question with multiple sub-parts, we will solve the first three sub-parts for…
Q: A Unemployment caused by a decrease in the demand for some goods and services B The equilibrium…
A: The greater the MPC, the greater the multiplier—the greater the rise in consumption from an increase…
Q: suppose you are given a consumption, investment and government expenditure functions as C= 700 +…
A: C= 700 + 0.6Y I= 360+ 0.3Y and G= 440
Question 3:
At a level of
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- Find the impact of these changes on National Income.
- Explain the leakages of multiplier
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- 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 What is the current equilibrium level of income? What is the level of injections? What is the level of withdrawals? 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)What is the value of the multiplier? What is the value of the multiplier? Comment on the results in part (3) and (4).During the 2012 fiscal year, households in an economy spent 80 per cent of their disposable income on consumption as well as GH¢300 consumption expenditure which is independent of income. Total government expenditure which stood at GH¢800 was supposed to be financed from a proportional tax levy of 50 per cent of national income and a VAT of GH¢100. Total private investment spending was made up of GH¢400 whereas export was GH¢400 and anautonomous import of GH¢500. Also, marginal propensity to import was 0.15 Determine the equilibrium national income for this economy.During the 2012 fiscal year, households in an economy spent 80 per cent of their disposable income on consumption as well as GH¢300 consumption expenditure which is independent of income. Total government expenditure which stood at GH¢800 was supposed to be financed from a proportional tax levy of 50 per cent of national income and a VAT of GH¢100. Total private investment spending was made up of GH¢400 whereas export was GH¢400 and anautonomous import of GH¢500. Also, marginal propensity to import was 0.15.1. Determine the equilibrium national income for this economy.2. Determine the consumption and savings levels at equilibrium national income.3. Find the size of the (expenditure) multiplier.4. Determine the new equilibrium level of income if government expenditure increases by GH¢70.5. If full employment output is 2000, what macroeconomic problem does this economy face? 6. In what direction should government expenditure change in order to achieve full employment output? 7. Determine…
- Assume the current equilibrium level of income is $200 billion as compared to the full-employment income level of $240 billion. If the MPC is 0.625, what change in aggregate expenditures is needed to achieve full employment? Multiple Choice a decrease of $12 billion an increase of $25 billion an increase of $10 billion an increase of $15 billionAnalyse the effect on equilibrium national income if the MPC falls from 0.95 to 0.4. Illustrate with the output expenditure and withdrawals-injections approachAssuming you are the Minister of Finance and Economic Planning for Nigeria, in charge of Fiscal Policy. The Research Director of the Ministry brought you the following data on Nigeria’s for the previous fiscal year, 2021. An examination of the data reveals that, during the fiscal year 2021, households in Nigeria saved 20% of their disposable income (Yd) and spent the rest on consumption. In addition, ₦5,000.00 was spent on Consumption expenditure (C), which is independent of income and Gross Private Investment (I) was ₦ 7,000.00. Total Government expenditure (G) which stood at ₦8,000.00 was supposed to be financed by a lump sum tax of ₦2,000.00 (independent of income) and a proportional tax rate of 25% of national income. Exports (X) stood at ₦2,500.00. In addition, the country’s import (M) during the previous fiscal year comprises of ₦1,000.00 which was independent of the country’s national income and 10% which was dependent of the country’s national income. Given these data on…
- Suppose an economy is depicted by the expenditure function provided below: C + G + I + X = $200 + 0.80×Y + $350 + $225 + $125 All figures are in billions of dollars. Assume there are no taxes in this nation so disposable income Yd = Y. The economy reaches an equilibrium at $enter your response here billion. (Enter your answer as a whole number)Consider an economy similar to that in the preceding question in which investment is also $200, government purchases are also $500, net exports are also $30, and the price level is also fixed. But taxes now vary with income and, as a result, the consumption schedule looks like the following: GDP Taxes DI C $1,360 $320 $1,040 $810 1,480 360 1,120 870 1,600 400 1,200 930 1,720 440 1,280 990 1,840 480 1,360 1,050 Find the equilibrium graphically. What is the marginal propensity to consume? What is the tax rate? Use your diagram to show the effect of a decrease of $60 in government purchases. What is the multiplier? Compare this answer to your answer to Test Yourself Question 1. What do you conclude? GDP…In the income multiplier is equal to 4, then a $25 initial increase in government spending leads to a Question 22 options: a) $6.25 increase in natinal income b) $25 increase in national income c) $6.25 increase in real GDP d) $100 increase in national income
- suppose the government in this economy decides to decrease government purchases by 300 billion decrease in government purchases will lead to a decrease in income generating an initial change in consumption equal toDetermine the change in the equilibrium level of consumption (find ΔC) following a decrease in government spending from 400 to 300 (ΔG = -$100). A: positive 400$ B: negative 300 c: negative 400 D: positive 300(b)Assume that a three-sector economy in Country W. The amount of autonomous consumption is RM300 million with the proportion of an increase in income that is spent on consumption is 0.5. An induced tax of 20% is imposed by the country. The amount of investment is RM250 million, and the amount of government spending is RM150 million. (i)Calculate the national income equilibrium. (ii)Based on your answer in (i), show the aggregate expenditure graph. (iii)Explain what would happen to the national income equilibrium if the investment changes by RM100 million.