Which of the following does NOT take place in a circular flow of income and expenditure model? ОА. Consumers and firms deposit funds and earn interest on savings in the financial sector. ов. Firms and consumers take loans to invest in capital goods and assets and have to pay interest on loans. OC. Firms sell factors of production in the factor market D. Importing countries pay using foreign exchange for imported goods and services.
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- From the table below answer, the following questions in the spaces provided, consider the following data (in billion $) for a country in a particular year: (Personal consumption expenditure (C 1000 (Exports (x 120 (Government Purchases of goods and services (G 400 (Imports (m 110 Gross Domestic Product (Y) 4,500 (Taxes (T 200 5) What is the value of gross investment (I)? Answer 6) What is the amount of investment financed by national savings? Answer 7) What is the amount of investment financed by borrowing from or lending to the rest of the world? Answer1. a. Write the components of GDP (from the table) according to the expendituremethod. 1. b. By using the expenditure method, calculate GDP for years 2018 and 2019. 1. c. Explain “Changes in inventories”. If a demand shock occurs in the economy and thedemand falls drastically when prices are flexible, how would “Changes in inventories”account respond this? Why? Country Name Year Exports Consumption Investment Net Exports Government Expenditure Imports Cambodia 2018 61.315 75.209 23.341 -1.699 4.904 63.014 Cambodia 2019 67.209 81.655 26.660 -1.512 5.288 68.721All values below are in trillions of dollars Household Consumption $11.9 State & Local Government Expenditures $1.46 Imports $2.04 Gross Private Investment $4.08 Federal Government Expenditures $2.80 Payments of Factor Income to Other Countries $3.21 Depreciation $0.99 Exports $1.57 Receipts of Factor Income from Other Countries $3.79 If GDP is $20 trillion, GNP is $________trillion.
- Consider an economy that produces two goods, an agricultural good and a manufacturing good. An amount YA of the agricultural good can be produced using the following equation: YA = LA where LA is the amount of labor used in this sector. An amount of YM of the manufacturing good can be produced using the following equation: YM = KθLM 1-θ where K is capital stock and LM is the amount of labor used in such sector. So, this economy’s total output (i.e. GDP) is: Y = YA + YM. This economy has zero population growth rate (i.e. n = 0) and the depreciation rate is δ. The total number of workers in the economy is L and of course, L = LM + LA. Let P = LA/L. Furthermore, define: y = Y/L, k = K/L and c = C/L. As usual, we have: ∆k = sy – (δ+n)k. Please use the above information to derive the key equation for this version of Solow model. Show the steady state of the economy is a diagram with k as the x-axes. Label k* , y* and c* in your diagram.The link between gross domestic product (GDP) and national income (NI) isSelect one from the following options. A)indirect business taxes, net foreign factor income, savings B)indirect business taxes, profit, investment C)indirect business taxes, net foreign factor income, consumption of fixed capital D)indirect business taxes, net foreign factor income, investmentGiven the following table Items RM Million Imports 70 Depreciation 50 Exports 80 Dividends 10 Government Purchases 120 Receipts Of Factor Income From The Rest Of World 20 Amount Of National Income Not Going To Households 10 Payments Of Factor Income From The Rest Of World 40 Net Private Domestic Investment 350 Personal Income Taxes 100 Personal Consumption Expenditures 750 Calculate the GDP Calculate the GNP Calculate the NNP Calculate the national income Calculate the personal income Calculate the disposable personal income
- Suppose GDP is $16 trillion, with $10 trillion coming from consumption, $2 trillion coming from gross investment, $3.5 trillion coming from government expenditures, and $500 billion coming from net exports. Also suppose that across the whole economy, depreciation (consumption of fixed capital) totals $1 trillion. From these figures, we see that net domestic product equals: a. $17.0 trillion. b. $16.0 trillion. c. $15.5 trillion. d. None of the above.You are given the following information about an economy GDP at Market Prices 1,,669.4Imports 290.5Gross Domestic Capital Formation 48.7Income accruing to the Public Sector 39.0Retained Business Earnings 75.9Exports 273.4Subsidies 16.8Factor Payments from Abroad 10.0Capital Consumption Allowance 10.5Income Payments to Foreigners 19.2Direct Taxes 355.6Public Sector Consumption Expenditure 490.1Indirect Taxes 297.3Transfer Payments 25.7 Derive the following: (i) Disposable Income (2) Household Consumption ExpenditureYou are given the following information about an economy GDP at Market Prices 1,,669.4Imports 290.5Gross Domestic Capital Formation 48.7Income accruing to the Public Sector 39.0Retained Business Earnings 75.9Exports 273.4Subsidies 16.8Factor Payments from Abroad 10.0Capital Consumption Allowance 10.5Income Payments to Foreigners 19.2Direct Taxes 355.6Public Sector Consumption Expenditure 490.1Indirect Taxes 297.3Transfer Payments 25.7 Derive the following:(i) National Income (ii) Net Investment (iii) Personal Income (iv) Disposable Income (v) Household Consumption Expenditure
- Need help with macroeconomic review questions! 1) How does the following transaction affect Canada’s GDP? Unless otherwiseindicated, assume that each of the subsequently mentioned people resides in Canada. (j) James Bond purchases a martini, shaken not stirred, for $12, in Calgary. 2) Consider a country with no government and no international trade. The country’seconomy has fixed prices and interest rates. Let C = 300 and I = 150 + 0.75Y . Whatis this country’s GDP? Show your work. 3) Consider a country with no international trade. The country’s economy has fixedprices and interest rates. Let C = 300 + 0.2Y , I = 250, and G = 0.5C. What is thiscountry’s GDP?During the year, suppose a country's total purchases of newly produced capital goods is $2,000 billion, it issues $1,600 billion of stock certificates, and has $500 billion in depreciation. Gross investment in this country equals A. $4,100 billion. B. $2,100 billion. C. $3,600 billion. D. $2,000 billion. E. $2,500 billion.According to the following information answer the questions. Macroeconomic Indicators: Country A Household final consumption: $40.3 billions Government final consumption: $15.7 billions Budget balance: $-3.8 billions Total Investment: $14.4 billions Exports of goods and services: $18.6 billions Imports of goods and services: $16.5 billions Country A's net capital inflow = $____billions Your Answer