In an economy S = -60 + 0.2Y and the invesment is 5000 calculate the 1)Equilibrium level of the income 2)Consumption expenditure at equilibrium
Q: Consider the following information: MPC = 0.9 Autonomous Investment = R200 m Autonomous…
A: Marginal propensity to consume: It measures the proportion of the change in the consumption level…
Q: Your consumption C is related to your disposable income by the equation, C = 200 + 3/5 Yd. Assume…
A: Consumption refers to buying goods or services for use by households. The consumption equation gives…
Q: E=C+I+G Expenditure m equilibrium, Income 'Y' is equal to 'AE. fY=$1265, C- $660, and 1= $325, solve…
A: A closed economy is one that has no exchanging movement with outside economies. The closed economy…
Q: Aggregate expenditure is 790. Income is 730 and consumption is 720, income increases to 750 and…
A: Investment can be calculated as follows: Aggregate…
Q: At equilibrium expenditure, unplanned change in inventories must be positive O True False
A: At equilibrium expenditure, aggregate expenditure is equal to real GDP.
Q: Explain the difference between induced consumption expenditure and autonomous consumption…
A: Expenditure incurred by the consumers for consumption irrespective of their income is termed as…
Q: U.S. Households Added $2.35 Trillion in Wealth The Federal Reserve reported that household wealth…
A: Consumption is the function of disposable income. Disposable income= Income - taxes When disposable…
Q: Assume autonomous consumption is Gh¢ 400 million, autonomous investment is Gh¢ 300 million and…
A: i.) Equilibrium national income: Equilibrium national income can be calculated as follows: Thus,…
Q: The value of consumption at the equilibrium le of output and income is? Aggregate spending at full…
A: A recessionary gap corresponds to a positive GDP gap where actual GDP is less than potential, while…
Q: Suppose the economy is determined by the following consumption and investment equations. C = 100+…
A: The measure that depicts the final value of goods and services during a specified period of time is…
Q: If the consumption function in an economy as follows C = 50 + 0.75Y and the following variables…
A: Given data: Consumption, C= 50+0.75Y Investment, I=250 MD Government expenditure (G)=200 MJD, Net…
Q: Japan increases investment by 12 billion. The magnitude of multiplier is 6. Calculate MPC
A: Rise in investment = 12 billion Multiplier = 6 MPC = ?
Q: C = 400 + 0.80Y and I = 200, then the level of consumption at equilibrium income is equal to
A: Equilibrium level of income: Y = C + I + G + NX where, Y is the income C is the consumption I is…
Q: Calculate the value of income if consumption is $440 and the average propensity to consume Is 0.88
A: The given information is:- Consumption by household = $440 APC = 0.88 We have to calculate the value…
Q: Explain the Equilibrium condition of Aggregate Expenditure= output Y. How are inventory changes…
A: AE = Y = C + I + G +X - M where, AE - Aggregate Expenditure Y - Output C - Consumption I -…
Q: An equation for Aggregate Expenditure is: AE = $3600 – 0.8Y, n equilibrium, Income 'Y' = Aggregate…
A: The aggregate expenditure = C+I+G+NX. C= consumption expenditure. I= investment expenditure. G=…
Q: Calculate change in consumption when change in income is $300 and the MPC is 0.42
A: The information being given is as:- Change in income = $300 MPC = 0.42 Change in consumption = ?
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: At equilibrium expenditure, unplanned change in inventories must be positive True False
A: Note: Since you have asked multiple questions, we will solve the first question for you. If you want…
Q: If the consumption function in an economy as follows C = 50 + 0.75Y and the following variables…
A: Given: Consumption function: C=50+0.75Y
Q: Find the value of change in investment if the value of multiplier is 5 and the change in national…
A: The information being given is as follows:- MULTIPLIER = 5 Change in national income = $1000 million…
Q: If the consumption function in an economy as follows C = 50 + 0.75Y and the following variables…
A: Equilibrium Income Y = C + I + G + NX
Q: An equation for Aggregate Expenditure is: AE = $3600 0.8Y, In equilibrium, Income 'Y' = Aggregate…
A: Given:
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: If the autonomous expenditure by the government increases by 7000 and the MPC is 0.2 find the level…
A:
Q: Calculate MPC, MPS and the Multiplier if consumption expenditure increases by $4,000 as a result of…
A: MPS+MPC =1
Q: For an economy the following consumption function is given : C = 60+0.75 Y. %3D (a) If investment in…
A: Answer: Y =380
Q: If the consumption function in an economy as follows C = 50 + 0.75Y and the following variables…
A: Given data: Consumption, C= 50+0.75Y Investment, I=250 MD Government expenditure, G=200 MJD, Net…
Q: Suppose Google plans to produce 10.2 million Pixel phones this year. The company expects to sell 7.6…
A: Production planned = 10.2 million Expected sales = 7.6 million Sales done at the end of year = 8.4…
Q: n an economy investment increases by 120 crores. The value of multiplier is 4. Calculate the…
A: Increase in investment = 120 crores. Value of multiplier = 4
Q: Find change in consumption if MPC is 0.92 and the change in income is $2200
A: MPC is the marginal propensity to consume which shows the proportion of income spent on consumption.
Q: An economy has a consumption function: C = 400 + .9DI Investment is 1,000. Government purchases are…
A: here we calculate the equilibrium level of output and choose the correct option which are as follow-
Q: Consumption = 115 + 0.6Y Investment = 550 Use the above information to answer the questions that…
A: Given that: Consumption = 115 + 0.6Y Investment = 550 Consumption and investment are the…
Q: uestion 1: In an economy C = 350 + 0.75 Y is the consumption function where C is consumption…
A: We measure the output of an economy using the gross domestic product. GDP or the gross domestic…
Q: 1. If the consumption function in an economy as follows C = 50 + 0.75Y and the following variables…
A: 1) Given Consumption (C) = 50 + 0.75Y Investment(I) = 250 MD Government expenditure(G) = 200MJD,…
Q: Explain the difference between induced consumption expenditure and autonomous consumption…
A: Consumption expenditure is the expenditure incurred by the household sector on the purchase of final…
Q: Consumption = 115 + 0.6Y Investment = 550 Use the above information to answer the questions that…
A: Aggregate expenditure is a measure of national income of an economy that considers the sum of all…
Q: If in an economy the consumption level is given as $110 while the disposable income is $220 find…
A:
Q: Calculate aggregate demand if consumption expenditure is $2300 million and the investment…
A: The given information is as follows:- Consumption in the economy = $2300 million Investment…
Q: Aggregate expenditure and Equilibrium output. Assume the following Consumption function (C) = 500…
A: Aggregate expenditure function: AE = C + I + G + Ex - Im => AE = 500 + (0.65)YD + 400 + 300 + 400…
Q: Consider an economy that is characterized by the following equations: C= 400 + 0.5 Yd I = 700 -…
A: Given; C= 400 + 0.5 Yd I = 700 - 4000i + 0.1Y G= 200 T= 200 (M/P)d = 0.75Y - 7500i (MP)= 600
Q: In the above table, C is consumption expenditure, / is investment, G is government expenditure, X is…
A: Option (b).
Q: If MPC is 0.12 and the change in income is $3300 Calculate change in consumption
A: The information being given is:- Marginal propensity to consume = 0.12 Change in income = $3300 We…
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: If we observe that every increase in income of $120 million generates an increase in consumption of…
A: Given: The increase in income is = $120 million The increase in consumption = $80 million To Find:…
In an economy S = -60 + 0.2Y and the invesment is 5000 calculate the
1)Equilibrium level of the income
2)Consumption expenditure at equilibrium
Step by step
Solved in 2 steps with 2 images
- Is the following statement TRUE or FALSE? Please provide reason for the answer. The positive relationship between consumption expenditure and disposable income can be shown by a positive slope of consumption curveExplain the difference between induced consumption expenditure and autonomous consumption expenditure. Why is not all consumption expenditure induced expenditure?The consumption expenditure and output of the country is 500 billion and 100 billion respectively. Calculate the average propensity to consume.
- Suppose the aggregate expenditure schedule for an economy is given by the equation: AE = 800 + 0.8Y Where AE represents the aggregate expenditure and Y represents the national income (output) level. Calculate the equilibrium level of national income in this economy.The MPC measures the relationship between: a change in consumption and a change in income. change in consumption and savings. changes in consumption and changes in savings. the proportion of income to consumption at any given level of income. the total level of consumption and the total level of saving.In year 1, the level of production in an economy is recorded as R1000m and in year 2 it increases to R1800m. Over the same period the level of consumption spending goes from R150m to R550m. Calculate the marginal propensity to consume. (3) Calculate the marginal propensity to save. (2)
- The accompanying graph represents the aggregate consumption function for the small island nation of Pineapple Paradise. The people of Pineapple Paradise expect their future disposable income to increase. Use the graph to show an increase in consumption expenditures. What is the new level of aggregate autonomous consumer spending? 1 $1000 2 $3000 3 $2000 4 $4000An equation for Aggregate Expenditure is: AE = $3600 + 0.8Y, In equilibrium, Income 'Y' = Aggregate Expenditure 'AE'. Solve for YFind autonomous Expenditure from the following:- Autonomous consumption = $200 Marginal propensity to consume = 0.6 National income = $3000
- Which of the following statements is most accurate? a.Most of the variation in consumption spending can be explained by changes in debt b. There is no single factor that explains much of the variation in consumption spending c. Most of the variation in consumption spending can be explained by changes in the interest rate. d. Most of the variation in consumption spending can be explained by changes in wealth e. most of the variation in consumption spending can be explained by changes in disposable income.in an economy C is equal to 300+0.5 Y and I= Rs.600 where C is consumption and Y is income calculate (a) equilibrium level of income (b) the consumption expenditure at equilibrium level of an income.Calculate the equilibrium value of output Y and interest rate r (round off your answers to one decimal point). Compute also the level of consumption and investment spending in equilibrium and check whether the actual level of spending matches the equilibrium level of output.
