Use the following information on economy X to answer the questions below. Consumption function: C= 250 + 0.8Y Investment spending: |= 150 Government spending: G= 500 Exports of goods and services: X= 200 Imports of goods and services: Z = 150 Proportional tax rate: t=25% Full employment level of income 3575 1. Calculate total autonomus spending for economy X. 2. Calculate the multiplier for economy X.
Use the following information on economy X to answer the questions below. Consumption function: C= 250 + 0.8Y Investment spending: |= 150 Government spending: G= 500 Exports of goods and services: X= 200 Imports of goods and services: Z = 150 Proportional tax rate: t=25% Full employment level of income 3575 1. Calculate total autonomus spending for economy X. 2. Calculate the multiplier for economy X.
Chapter9: Aggregate Expenditures
Section: Chapter Questions
Problem 6E
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Transcribed Image Text:Use the following information on economy X to answer the questions below.
Consumption function:
C= 250 + 0.8Y Investment spending:
|= 150 Government spending:
G= 500 Exports of goods and services:
X= 200 Imports of goods and services:
Z = 150 Proportional tax rate: t =25%
Full employment level of income = 3575
1. Calculate total autonomus spending for economy X.
2. Calculate the multiplier for economy X.
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