Bundle: Exploring Macroeconomics, Loose-leaf Version, 7th + LMS Integrated MindTap Economics, 1 term (6 months) Printed Access Card
7th Edition
ISBN: 9781305784802
Author: Robert L. Sexton
Publisher: Cengage Learning
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Question
Chapter 15, Problem 16P
a) Detect a trend upward or downward in inventory levels
To determine
Whether the inventory levels for trend is upward or downward
b) What the trend bode for national output according to the aggregate expenditure model
To determine
The what the trend bode for national output according to the aggregate expenditure model.
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Chapter 15 Solutions
Bundle: Exploring Macroeconomics, Loose-leaf Version, 7th + LMS Integrated MindTap Economics, 1 term (6 months) Printed Access Card
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- Based on The Aggregate Expenditure Model, what affects the level of consumption (five factors); and what affects the level of investment (four factors)?arrow_forwardWhat are the determinants of aggregate demand? How do these determinants differ from the determinants of aggregate expenditure? What is the significance, if any, of these differences?arrow_forwardNational income accounting (GDP calculate) is an essential part of macroeconomics. Analyse the following hypothetical economy and answer the questions that follow: G = 400, I = 70, X = 300, M =100, autonomous consumption = 100, MPC = 0.6, taxes=50 Calculate the level of national income in this economy What percentage of disposable income do people save? Calculate the level of savings Show that in this economy, injections are indeed equal to withdrawals Calculate the multiplier? Using the multiplier in v above, what would be the new level of national income if government spending rose to 500?arrow_forward
- suppose there is a permanent upward shift of the Federal Reserve’s reaction function.What will be the short-run effect of the shift in the reaction function on GDP?Describe briefly how GDP returns to its potential level.arrow_forwardCalculate the value of consumption expenditure from the following:- National income = $6000 Autonomous consumption = $1000 Marginal propensity to consume = 0.80arrow_forwardPlease my dear not hand written.arrow_forward
- Which equation represents the macroeconomic equilibrium condition in the aggregate expenditure (AE) model?arrow_forwardAnswer the question on the basis of the following table for a particular country in which C is consumption expenditures, Ig is gross investment expenditures, G is government expenditures, X is exports, and M is imports. All figures are in billions of dollars. Each question is independent of other question using the same table, unless otherwise stated. Price Level C Ig G X M Real GDP 128 $18 $2 $3 $1 $5 125 $20 $4 $3 $2 $4 122 $22 $6 $3 $3 $3 119 $24 $8 $3 $4 $2 116 $26 $10 $3 $5 $1 Refer to the table. The real-balances effect of changes in the price level is: Group of answer choices shown by columns (1) and (5) of the table. shown by columns (1) and (4) of the table. not shown by the data in the table. shown by columns (1) and (2) of the table.arrow_forwardWrite out and explain the GDP and Aggregate Expenditure identity equations.arrow_forward
- Answer the following questions, which relate to the aggregate expenditures model: Instructions: Enter your answer as a whole number. a. If Ca is $130, lg is $60, X, is -$10, and G is $40, what is the economy's equilibrium GDP? $ b. If real GDP in an economy is currently $250, Ca is $130, l is $60, Xn is –$10, and G is $40, will the economy's real GDP rise, fall, or stay the same? |(Click to select) c. Suppose that full-employment (and full-capacity) output in an economy is $250. If Ca is $180, Ig is $60, Xn is -$10, and Gis $40, what will be the macroeconomic result? O There will be an inflationary expenditure gap and employment levels will be above the full-employment level. O There will be an inflationary expenditure gap and employment levels will be below the full-employment level.arrow_forwardHow might the following events affect the real gross domestic product (GDP) and what would happen to economic well-being in each case? Briefly explain. The government of Pakistan decides a lockdown in the economy for an indefinite period of time. The discovery of high yielding variety (HYV) seeds improves farm harvests. Goods transporters observe strike in the economy. Small and Medium Size Enterprises (SMEs) experience subdued demand causing them to lay off employees. Suppose the parliament of Pakistan passes new environmental laws that restrict firms from using production techniques that cause pollution. A large number of people join university as full-time students.arrow_forwardExplain, in detail, how the adjustment to macroeconomic equilibrium occurs when spending is less than production. Be sure to discuss how inventories play a crucial role in the adjustment process. State what happens to GDP and employment during the adjustment process.arrow_forward
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