ECON MACRO
5th Edition
ISBN: 9781337430401
Author: William A. McEachern
Publisher: Cengage Limited
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Question
Chapter 9, Problem 4.8P
To determine
Components of aggregate expenditure, component that varies with changes in level of real
Introduction: Aggregate expenditure is a measure of
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What is the difference between aggregate expenditure and aggregate demand? Why is the aggregate demand curve downward sloping while the aggregate expenditure line is upward sloping?
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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_forwardCalculate the four components of aggregate expenditure and GDP for the following economy using data from the table below. Instructions: Enter your responses as whole numbers. If you are entering any negative numbers, be sure to include a negative (-) sign in front of those numbers. Consumption expenditures Exports Government purchases of goods and services Construction of new homes and apartments Sales of existing homes and apartments Imports GDP Beginning-of-year inventory stocks End-of-year inventory stocks Business fixed investment Government payments to retirees Household purchases of durable goods Consumption expenditures: $ Investment expenditures: $ Government Purchases: $ Net Exports: $ GDP: $ $800 $50 $200 $200 $200 $125 $100 $100 $100 $100 $150arrow_forwardWhat does it mean when the aggregate expenditure line crosses the 45-degree line? In other words, how would you explain the intersection in words?arrow_forward
- Macroeconomics? How to derive the total expenditure curve?arrow_forwardConsider the circular flow of expenditure and income in the Canadian economy. Which of the following is an injection into the circular flow? Select one: a. You make an online purchase from a U.S. retailer. b. Loblaws pays corporate income tax to the federal government. c. Bombardier exports subway cars to Mexico. d. Bombardier imports machine parts from Germany. e. You put $500 into your TFSA (tax-free savings account).arrow_forwardwith the aid of a diagram, explain the income and expenditure modelarrow_forward
- Calculate total GDP for this economy given the following components of supply. Round your answer to the nearest tenth and enter the value in trillions of dollars (i.e. $xx.x trillion). of GDP on the Supply Side (in trillions of dollars) Components Durable goods Nondurable goods Services Structures Change in inventories Provide your answer below: trillion Total 3.8 2.7 12.2 2.1 0 ?arrow_forwardAn economy is described by the following equations: C= 2,000 + 0.75 (Y – T) Ip= 900 G= 2,000 NX= 200 T= 2,000 Y*= 15,000 What is the Autonomous expenditure in the economy?arrow_forwardUse the following information to complete the calculations. C = 15235 + 0.67Y I = 8777 G = 3425 NX = -551 What is the value of autonomous expenditure (AE)? Round your answer to the nearest dollar. AE: $ Calculate the equilibrium level of GDP. Round your answer to the nearest dollar. GDP: $arrow_forward
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