The following information is provided about an open economy with a government. Use the information to answer the questions that follow: C = 450 + 0.4Y I = 350 G = 150 X = 70 Z = 35 + 0.1Y T = 0.15Y Yf = 1550 Calculate the equilibrium level of income
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The following information is provided about an open economy with a government. Use the
information to answer the questions that follow:
C = 450 + 0.4Y
I = 350
G = 150
X = 70
Z = 35 + 0.1Y
T = 0.15Y
Yf = 1550
Calculate the equilibrium level of income
(Hint: use the multiplier method
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- Suppose the following information is about a hypothetical open economy. C= 500+0.8Y , lg = 300 , G= 300 , Xn = 100.calculate equlibrium income, equlibrium consumption, find the new equlibrium income if gross domestic investment decreases to 200 and calculate the multiplier for this macroeconomic model.Which of the following best describes the catch-up effect? Question 14 options: It is easier for a country to grow fast and "catch up" with richer countries if it starts out relatively poor. Saving will always "catch up" with investment spending. If investment spending is low, increased saving will help investment to "catch up." Rich countries aid relatively poor countries so as to help them "catch up."The following question relates only to the equilibrium in the goods market IN A CLOSED ECONOMY and asks you to carry out a graphical analysis using both the Keynesian cross diagram together with the IS-MP diagram. >>) Suppose after the government has implemented the reduction in taxation that the central bank wants to keep the level of investment at the same level as before the tax reduction. How can the central bank intervene in the market to achieve this goal? Explain and illustrate graphically how the central bank can keep investment at the same level as before. Is there any additional impact of the central bank intervention on output, consumption and interest rates? If so what is the impact?
- You are given the following information about a closed economy with no government: Consumption = 115 + 0.6Y Investment = 550 Calculate the value of autonomous spending.What effect will each of the changes listed in Study Question 3 of Chapter 27 have on the equilibrium level of GDP in the private closed economy? Explain your answers.In a closed economy model without government spending, aggregate demand is the sum of... a. Savings (S) and investment (I) b. Savings (S) and Consumption (C) c. Consumption (C) and Income (Y) d. Consumption (C) and Investment (I)
- You are given the following information about a closed economy with no government:Consumption = 445 + 0.75Y Investment = 250 Calculate the value of autonomous spending.The following information is provided about an open economy with a government. Use the information to answer the questions that follow:C = 450 + 0.4YI = 350G = 150X = 70Z = 35 + 0.1YT = 0.15YYf = 1550 Calculate the size of the multiplier(Note: Round your answer to two decimal places)For the goods market of an open economy to be in equilibrium, the interest rate must be at 2% when GDP equals 120. We also know the following about consumption (C), investment (1), fiscal policy (taxes T and government expenditures G), imports (M) and exports (X) of the country: C = 20 + b*Y_{D} I = 44 T = 60 G = 22 M = 16 X = 32 where b is the marginal propensity to consume and Yo is net disposable income. What is the value of total consumption? Select one: a. 18 b. 20 C. 38 d. 120
- 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 percentConsider the changes in equilibrium that are presented in the following graph: The change from E0 to E2 is caused by.. Answer Choice Group Appreciation of the national currency Depreciation of the national currency Increase in taxes paid by companies in the country A decrease in the price of gasolineThe following information is provided about an open economy with a government. Use theinformation to answer the questions that follow:C = 450 + 0.4YI = 350G = 150X = 70Z = 35 + 0.1YT = 0.15YYf = 1550Q.2.1 Calculate the level of autonomous spending in this economy. Q.2.2 Calculate the size of the multiplier(Note: Round your answer to two decimal places)Q.2.3 Calculate the equilibrium level of income(Hint: use the multiplier method) Q.2.4 Calculate the tax revenue to the government of this country when the economyremains in equilibrium.Q.2.5 Calculate what the new equilibrium income should be if the government of thiscountry decides to cancel all taxes, implying the tax rate would now be 0%.Q.2.6 Before the government decreased the tax rate, how much of governmentspending was required to bring the economy to full employment?