Why are changes in inventories included as part of investment spending? Suppose inventories declined by $1 billion during 2008. How would this affect the size of gross private domestic investment and gross domestic product in 2008? Explain.

Q: The table below provides Income and consumption Data in billions of dollars. Answer question below…

A: Here, the given table shows the consumption level at different income levels in an economy.

Q: Q6. Where do new-home sales appear in the circular flow of expenditure and income? Explain how a…

A: The total financial or market value of all finished product and services created within a country's…

Q: In 2017, $1000 worth of shirts are produced by Calvin Klein. That same year, $700 worth of shirts…

A: Consumption is a positive function of income. If income rises by 1 unit, consumption rises by less…

Q: In a two-sector economy, Aggregate Expenditure (AE) equals

A: Since you have asked multiple questions, we will answer the first question for you. If you want any…

Q: If the government decreases taxes, disposable income does not change. falls. increases.…

A: personal disposable income is the part of personal income left after payment of direct taxes, it is…

Q: enditu

A: Gross domestic products includes all final goods and services which are being produced by the…

Q: New U.S. home sales surged Purchases of new U.S. homes surged in December and 2015 was the best year…

A: Gross domestic product (GDP): - GDP is the market value of all final goods and services produced in…

Q: Which of the following statements is most accurate? a.Most of the variation in consumption…

A: The consumption expenditure is the expenditure made by the consumers towards the consumption of…

Q: The equilibrium position for an economy is represented by the following equations: Y = C + I, + G…

A:

Q: What is the effect on aggregate expenditure if the value of exports exceeds the value of imports in…

A: Aggregate expenditure is the expenditure which all the factors undertake during a specific period of…

Q: how will the different components of aggregate expenditure be affected by the increase in government…

A: The economics as a study is based upon the basic idea that resources which are present with the…

Q: Explain the difference between induced consumption expenditure and autonomous consumption…

A: Expenditure incurred by the consumers for consumption irrespective of their income is termed as…

Q: Which of the following will not cause an increase in equilibrium GDP? a) an increase in government…

A: According to the expenditure approach of calculating national income,  Y= C+I+G+NX C is the domestic…

Q: Which one of the following statements about consumption spending is incorrect? А. Spending on…

A: Consumption Spending is one of the most important component of Gross Domestic Product. Consumption…

Q: If government spends $10B and the MPC in the economy is .8.  What will be the total change in GDP?

A: A multiplier is a term used in economics to describe an economic factor that, when increased or…

Q: For the following situations, find the value of consumption, aggregate expenditures, unplanned…

A:

Q: Investment increases by $200 million and the value of MPC is 0.75. What would be the total increase…

A: Total increase in spending = multiplier * increase in spending Multiplier= 1/(1-MPC)…

Q: what will be the consumption expenditure when the income is 14330 million and the savings are 8100…

A: Generally in the question, Income is stated as = 14330 million Savings are usually denoted as = 8100…

Q: Q1. Explain why exports are added and imports deducted from aggregate expenditure?

A: The final value of goods and services being produced in an economy within a specified period of time…

Q: ace each of the following transactions in one of the four components of expenditure: consumption,…

A: The expenditure components are : Consumption, Investments, Government expenditure and export. The…

Q: Fluctuation of savings and investment rates impact on GDP of any macroeconomics. Comment with the…

A: GDP or the gross domestic product is the value of all the final goods and services which are newly…

Q: (Aggregate Expenditure) What are the components of aggregate expenditure? In the model developed in…

A: Components of aggregate expenditure are consumption and investment along with net exports.

Q: What is the effect on aggregate expenditure if the values of exports exceeds the value of imports in…

A: Answer: Introduction: Aggregate expenditure: it refers to the sum of consumer spending (C), producer…

Q: How increasing housing prices in the US to its highest historical levels affect the US economy and…

A: GDP or Gross Domestic Product refers to the final value associated with all the goods and services…

Q: In the above table, C is consumption expenditure, / is investment, G is government expenditure, X is…

A: Real GDP C I G X M 100 75 25 95 10 1 200 150 25 95 10 2 300 225 25 95 10 3 400 300 25 95 10…

Q: How is it possible for consumption expenditure to be positive even when disposable income is zero?

A: The consumption function gives the relationship between consumption and disposable income.

Q: If consumption expenditure is $30 billion, investment spending is $15 billion, government spending…

A: Consumption = $30 billion Investment = $15 billion Government spending = $12 billion Exports = $4…

Q: You purchase a Tesla Model 3. What is the impact to the different components of the U.S. GDP and the…

A: GDP is the gross domestic product which is the final value of goods and services that are produced…

Q: What is the level of aggregate expen level of income? Graph the aggregate expenditures function.

A: Aggregate expenditure is the sum of consumption, investment, government spending, and net exports.…

Q: Calculate the value of final Consumption Expenditure when the value of national income is $5000 ,…

A: # The value of the final consumption expenditure is given by the equation:- C = Autonomous…

Q: An economy has the following data: real GDP $5,166 billion taxes collected by the government $499…

A: GDP: It refers to the goods and services which can be produced in an economy during a particular…

Q: The accompanying table shows gross domestic product (GDP), disposable income (YD), consumer spending…

A: Planned aggregate expenditure = Consumption spending + Planned investment spending AEplanned = C +…

Q: Suppose that GDP was $250 billion in year 1 and that all other components of expenditures remained…

A: GDP stands for gross domestic product which is the sum of value of all goods and services produced…

Q: Which components of aggregate expenditure do not directly depend on current income?

A: Aggregate expenditure refers to the current value of all the final goods and services produced in an…

Q: Calculate the expected change in GDP if the federal government announces it will spend an additional…

A: Change in the government expenditure=$80 million Marginal propensity to consume(MPC)=0.6 Change in…

Q: If consumption expenditure is $3100 and savings is $1800 Calculate income

A: According to the above mentioned question, we have:- Consumption expenditure = $3100 Savings = $1800…

Q: expenditure at equilibrium level of national income. (1) C = 200 + 0.5 Y is the consumption…

A: The equilibrium level of the national income refers that when  the aggregate supply and the…

Q: In the third quarter of 2008, investment in the U.S. totaled $4,2 trillion and in 2007, investment…

A: Multiplier = 1 / [1 - MPC] Increase in real GDP = Increase in investment spending * Multiplier

Q: C = 180 + 0.70YD |= 150 G = 190 T= 120 a.) Equilibrium GDP (Y) = (Round your response to two decimal…

A: The total amount of goods and services that produced in an economy in a given period of time is…

Q: im having a little toruble with the following question and answer: The Commerce Department reported…

A: Gross Domestic Product (GDP):It is the primary indicator which shows the health of an economy. It…

Q: Which of the following correctly describes how a decrease in the price level affects consumption…

A: Decline in price level means decline in the prices of goods and services.  It means that value of…

Q: In an hypothetical Economy, the consumption function is:- C = 100 + 0.3Y Calculate the value of…

A: According to the above given question, the consumption expenditure is given as:- C = 100 + 0.3Y We…

Q: If the increase in government spending is $500 and the marginal propensity to consume is .75 then…

A: The change in the real gross domestic product depends on the value of the marginal propensity to…