Only typed answer Suppose that an economy has the following functions for C, I, G, and NX: C= 51 + 0.89V I = 47 €=35 NX=12-0.10Y and the local tax rate is equal to 28%. What is the Simple Multiplier in this case?
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Only typed answer
Suppose that an economy has the following functions for C, I, G, and NX:
C= 51 + 0.89V
I = 47
€=35
NX=12-0.10Y
and the local tax rate is equal to 28%.
What is the Simple Multiplier in this case?
Step by step
Solved in 3 steps
- If the MPC is 0.75, the tax multiplier is Group of answer choices -1.666. -1. -3. -2.5In an economy where the MPC is 0.7, the proportional tax rate is 0.25 and the marginal propensity to import is 0.2, the multiplier will be:Select one:a.0.675b.1.48c.2.35d.2.1If the MPS is 0.1 and the income tax rate is 0.33 the multiplier is approximately
- If the MPC is 0.9, then the tax multiplier is a. -0.1 b. -1.11 c. -9 d. -10If the MPC is 0.9, the the government spending multiplier is: a. 0.1 b. 1.11 c.9 d. 10 If the MPC is 0.9, then the tax multiplier is: a. -0.1 b. -1.11 c. -9 d. -10If the consumption function is C - $250 +0.75(Y), the MPS is__, the government spending multiplier is multiplier is and the tax O 0.25: -3,4 0.25:4:-3 O 0.75:-3;4 O 0.75; 4;-3
- If MPC Is 0.5 so what is MPS ( define as well)If the MPS in an economy is 0.4. What is the government spending multiplier? Group of answer choices a. 0.4 b. 2.5 c. 1.5 d. 1.67Assume there are 2 people Xavier with a Marginal propensity to consume (MPC) of 80% and Francis with a Marginal Propensity to save (MPS) of 10%. Xavier enjoys life and has a minimum consumption of $10,000 without any income, while Francis is more modest, with a minimum consumption of $7,500 without any income. a. Demonstrate and explain the income expenditure model for Xavier and Francis on separate graphs with income ranging from 0 to $100,000 in $20,000 increments. b. Compare the minimum income levels where savings begins for Xavier and Francis. c. How does the difference in MPC affect the economies for each state? d. If the government decides to take all savings above $2,000, is this fair to Xavier? Francis? e. How might this change their behavior? How is this relevant to discussions about wealth inequality? How are individual choices relevant to wealth inequality?
- In the country A , autonomous consumption (CA) is 100, marginal propensity to consume (CY) is 0.5, investment expenditure (I) is 50, government spending (G) is 50, lump-sum tax collection (T) is 20 and income tax rate (t) is 0.2. AE = C + I + G According to the information above, fill in the blanks. a) The equilibrium output is: _____________ b) If the lump-sum tax increases to 40, the new equilibrium output is: _______ c) The tax multiplier (numerically) is: ______________TRUE/FALSE We argued that the tax multiplier is higher in absolute value than the government spending multiplier.For an econmomy with a MPC of .80 the multiplier will be 5 4 a magnitue of 1 less than the tax multiplier determined by the elasticity of the money supply
