Fluctuations in investment:are larger during expansions than during recessions.account for little of the variability in gross domestic product (GDP).account for almost all of the variability in gross domestic product (GDP) only duringexpansions.account for more of the variability in gross domestic product (GDP) than consumption.account for almost all of the variability in gross domestic product (GDP) only during recessions.hp

Economic fluctuations are almost impossible to predict with much accuracy. Investment fluctuates…

Answered: Fluctuations in investment: are larger…

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter9: Aggregate Expenditures

Section: Chapter Questions

Problem 5E

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If aggretate exppenditure is greater than total income: investment will decrease because such a high level cannot be sustained. planned savings will decrease in line with investment. output will increase to replenish depleted inventories. investment will decrease to run down excessive inventories. there is an error, since the two are same by definition
Evaluating the relationship between R&D expenditures and net income is an example of the diagnostic analytics of __________. Multiple Choice determining relations/patterns/linkages between variables through statistical analysis performing drill-down detailed analytics identifying anomalies/outliers performing descriptive analytics
True or False: Personal Consumption Expenditures account for about 25% of GDP. Spending on Consumer Durable Goods tends to be very stable from year to year. Sales of used goods are included in GDP at 35% of their original sale price.
The Bureau of economic analysis announced today that gross domestic product, the widest measure economic activity, grew in a meager 0.9% annualized rate in the third quarter compared to the first six months of 2018 the US economy in the first 3 quarters of 2019 grew just 1.6%, a pronounced slow down relative to the 3.9% growth in the second half of 2018. Some of this slowdown can be explained by a negative contribution from inventory investment, which contracted 0.9% in the third quarter. There’s plenty to worry about in this report, as it showed us Retail sales Fell for the first time in seven months in September, although overall consumer spending which comprises about 66% of the US GDP activity was up 0 .4%. Capacity utilization also decreased 0.4% in the third quarter to 74.5%.1. Write a phrase from the article that speaks to change in household consumption in the third quarter in 2019. 2. From the information in this article, did household consumption increase or decrease in the…
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…
Inflationary GDP is the amount by which equilibrium real GDP falls short of the full employment level of GDP. True or False
Home equity is the single largest component of net wealth for most families in the United States. If home equity falls a. autonomous consumption will decrease, shifting the aggregate planned expenditure line downward b. the marginal propensity to consume will decrease, decreasing the slope of the aggregate planned expenditure line c. autonomous consumption will increase, shifting the aggregate planned expenditure line upward d. the marginal propensity to consume will decrease, increasing the slope of the aggregate planned expenditure line e. autonomous consumption will decrease, shifting the aggregate planned expenditure line upward
in 2019 fiscal year estimated that Ghanaians saved 20 percent of their disposable income; however, due to overconsumption in the previous year, autonomous saving for 2019 was negative 100 million Ghana cedis. The government of Ghana imposed a lump sum tax of Gh ₡ 20 million. In addition to the lump sum tax the government also took 20 percent of all incomesearned in the economy in the form of proportional tax. The total government expenditure was GH ₡50 million in 2019. Total investment recorded for 2019 was 66 million. (A) Determine the tax function for this economy, derive the consumption function based on the above information and write out the aggregate demand equation (b) Determine the equilibrium consumption and calculate the value of the government expenditure multiplier for this economy and interpret your result (c) Calculate the total tax revenue to the government
If the autonomous expenditure by the government increases by 7000 and the MPC is 0.2 find the level of new income in the economy
The firm you work for wants you to provide some insight into the investment environment in Mexico before deciding to enter the market. You conduct some research and find a large dispersion of MRPK across firms in Mexico. You also notice that state-owned firms have lower MRPK. Which of the following observations can you make? (there can be more than 1) Firms in Mexico have a hard time expanding due to constraints on the labor market Private firms are at an advantage in Mexico as they face lower capital costs than those owned by the state Resources are likely misallocated because capital is not flowing from firms with low MRPK to firms with high MRPK Your firm may find it more costly to borrow than its state-owned competitors
Nigeria is currently experiencing a recessionary gap of approximately 24.6 billion krone. Its MPC is approximately 0.8. How much would the government have to change spending to close the gap? Assume a horizontal SRAS. If the government should decrease spending, enter a negative answer. one decimal pl

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