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If the output gap is -0.6 and real potential output is 1.0, what is real GDP growth?
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- Can government spending that causes crowding out be detrimental to long-run economic growth?Potential real GDP is equal to $10,000 and the current level of real GDP is equal to $9,000. What does the output gap equal (%)?Can government spending that causes crowding out be detrimental to long-run economic growth? Explain.
- True or False... When savings equals investment, reducing savings and increasing consumption is especially effective in stimulating output.For a high-income economy like Australia, what aggregate production function elements are most important in bringing about growth in GDP per capita? What about a middleincome country such as India? A low-income country such as Afghanistan?In a hypothetical economy, real GDP is $10 trillion, investment is $2 trillion, the capital stock is $20 trillion, the depreciation rate is 4.5% and the labor supply growth rate is 1%. Which statement is correct? Capital per worker is increasing in this economy Aggregate demand is decreasing in this economy Aggregate demand is increasing in this economy Capital per worker is decreasing in this economy
- In the very long run, what are the major factors that are responsible for growth in potential output or GDP? Use the production function to support your answer.Consider a closed economy without a government. If the GDP of the economy is $63,000 and the consumption in the economy is $45,000, the saving rate in the economy is ________. 86 percent 24 percent 57 percent 75 percentIn the Savings-Investment model, what is the effect of an increase in government spending on investment? Why?
- If potential GDP for the first quarter of 2013 = $75.8 billion, and real GDP for the first quarter of 2013 = $80.3 billion, then the output gap was..........?What two variables are most important for sustained long-run growth? options: Increasing capital and increasing total factor productivity Decreasing taxes and increasing government expenditures Increasing money supply and decreasing interest rates Increasing consumption and increasing investment in inventoriesExplain three types of capital receipts in an given economy?
