True or False: The economy is currently in long-run equilibrium. True False The economy is best described as being

Q: Refer to the figure above. Based on the figure, If the economy is in short-run equilibrium with…

A: 16,000 is less than 20,000, thus, there is a recessionary gap and it can be closed by increasing…

Q: Two countries are in a recession. Country A has an MPC of 0.8 and Country B has an MPC of 0.6. In…

A: Country A MPC = 0.8G Government Spending Multiplier=11-MPCGovernment Spending…

Q: The fiscal policy is less effective if the IS curve is stepper. Is this statement are true or false…

A: Effectiveness of fiscal and monetary policy depends on the slope of IS and LM curve .

Q: conomists defined economic recession as more than 2 consecutive quarters in which there is a decline…

A: Economic recession is referred to the fall or decline in the GDP  in the comparison of last year,…

Q: The economy is in a recession. The government enacts a policy to increase spending by $10 billion.…

A: Given: The government increases the spending by = $10 billion The MPS = 0.1 The aggregate supply…

Q: Suppose the economy is closed. Then at every point along the aggregate demand curve, A G = T none of…

A: Aggregate demand is a measure of the total demand for all completed goods and services produced in a…

Q: s shown in Exhibit 2, this economy is in macro equilibrium at:   Group of answer choices $2…

A: The model that includes Consumption and Investment is referred as the Aggregate Expenditures Model.…

Q: Suppose an economy is at the short run equilibrium which its current output level called Y1, is…

A: The economy is at the short run equilibrium at income Y1 and the price level P1. At this point,…

Q: An economist who claims that an increase in government spending would result mainly in a higher…

A: An increase in government spending would result mainly in a higher price level.

Q: True or False If spending exceeds output, real GDP will decline as firms cut back on production.

A: If Actual Spending is greater than the Output, then more is being demanded than is being supplied.…

Q: Consider an economy that is operating below the full-employment level of real GDP. What would be the…

A: Meaning of Gross Domestic Product (GDP): The term gross domestic product refers to the situation…

Q: Calculate the change in aggregate output (to one decimal place) if the marginal propensity to…

A: Here, marginal propensity to consume is given as 0.38, according to the which one can identify the…

Q: Y=C t /even when the economy is not in equilibrium

A:

Q: ⁢42billion, and spending on imports was $35$⁢35 billion. The price level increases, resulting in a…

A: Given : Consumption spending = $150 billion Investment Spending=$40 billion Government spending=$50…

Q: The government raises taxes by $100 billion. If the marginal propensity to consume is 0.8 What…

A: For a closed economy national income can be expressed as a sum of consumption, investment and…

Q: TRUE OR FALSE WITH REASON. 1. In a recessionary gap, the Real GDP that the economy is producing is…

A: In a recessionary gap, the Real GDP that the economy is producing is lesser than Natural Real GDP.…

Q: Suppose MPC = 0.8 and government spending increases by 1 trillion dollars. In the AD-AS equilibrium,…

A: The macroeconomic equilbrium in an economy is determined by the aggregate demand and aggregate…

Q: If the MPC in an economy is 0.7, the government could shift the aggregate demand curve rightward by…

A: The marginal propensity to consume (MPC) is defined as the proportion of an aggregate raise in pay…

Q: The graph shows an economy that has experienced a fall in total spending. What is the long run…

A: Long-run aggregate supply shows the total production or output in the economy at full employment. A…

Q: The marginal propensity to save is 0.55 What is the value of Marginal propensity to consume

A: According to the question, we are given the value of Marginal propensity to save as 0.55 This helps…

Q: Differentiate the macroeconomic effects that explain the causes of the differences of government…

A: By market value, aggregate demand is determined which only symbolizes total output at a given level…

Q: he aggregate demand curve is directly derived from the expenditures schedule.  True or  False

A: An AD  curve (aggregate demand )  states the whole spending on commodities and services at per level…

Q: If taxes increases from $100 billion to $139 billion, and the MPC is 0.8, how much is the change in…

A: Aggregate demand is classified as the combination or merging of the demand of the services and the…

Q: or False: The economy is currently in short-run equilibrium.

A: True  The economy is in short run equilibrium where SRAS = AD at 80 units of output and $ 100 price…

Q: Question 6 Suppose that an economy is currently in its long run equilibrium. Suppose that the…

A: The AD–AS model, also known as the aggregate demand–aggregate supply model, is a macroeconomic model…

Q: a recessionary gap exists when aggregate demand  is above the full employment level of output true…

A: A recessionary gap occurs when a country's real GDP is lower than its GDP at full employment.

Q: Suppose most business executives expect a slowdown in the economy.  How might this situation affect…

A: The loss of business and consumer confidence leads to an economic recession.

Q: Suppose that the MPS = 0.2 and the government is interested in raising the level of output in the…

A: MPS is marginal propensity to save is the extra amount of money that a household saves from his…

Q: Y =  C +  S even when the economy is not in equilibrium.  True Or False

A: In an economy, saving is the part of income which is not spent on consumption expenditure, and so Y…

Q: Suppose there are no imports, taxes or other leakages in the economy. If the Marginal Propensity to…

A:

Q: Income is 678 Trillion and consumption is 662 Trillion then income increases to 698 Trillion and…

A: The marginal propensity to consume can be defined as the ratio of the change in the spending on…

Q: Q1) Would you expect the short-run marginal propensity to consume to be different between farmers…

A: The marginal propensity to consume (MPC) is a term used in economics to describe how much a boost in…

Q: The economy is at the Keynesian equilibrium. Assuming that taxes are zero, a decrease in the…

A: The keynesian equilibrium occurs where the aggregate expenditure is equal to the output or where the…

Q: The French economist Jean-Baptiste Say trans-  formed the equality of total output and total…

A: OPTION C - Supply creates its own demand This is called the Say's Law.  It says that if a good is…

Q: Nigeria is currently experiencing a recessionary gap of approximately 24.6 billion in their…

A: Tax multiplier = MPC / 1-MPC Recessionary gap = Real GDP is less than potential GDP.

Q: Macroeconomics: Assuming marginal propensity to consume is 0.5. If there is a shock to the economy…

A: National income indicates the level of consumption, investment, and expenditure in the economy. Any…

Q: The level of AD needed to achieve full employment is $150 billion. The current level of Real GDP…

A: Answer - Marginal Propensity of Consume :- It is the rate of change in the consumption with change…

Q: ow does government or Fed recover the economy in the short run. Please use figures and words to…

A: In the short run, the economy may move away from the full employment level, also known as the…

Q: If the MPC in an economy is 0.75, government could shift the aggregate demand curve leftward by $30…

A: MPC= Percentage of new income that is spent on consumption rather than saving

Q: True or false? Why? "A temporary tax rise never has a significant effect on current consumption."

A: On the off chance that people realize that the tax overcharge is impermanent, they won't modify…

Q: Starting with AD1 and AS1 in the graph below, an increase in capital stock would mean the: AS1 AS 2…

A: An increase in capital stock means , the business sector adds a sizable quantity of factories,…