2.a) Using the following parameters calculate equilibrium Y in a private closed, private open and mixed open economy using the mathematical and tabular methods. Consumption-2600+0.7Y Tax=200+0.1Y Government Spending-4800 Investment-5000 Exports <-800 Imports-600+0.05Y ) Illustrate and explain how the AE curve changes as we move from a private closed to private open to mixed open economy and also, also what happens to the multiplier

2.a) Using the following parameters calculate equilibrium Y in a private closed, private open and mixed open economy using the mathematical and tabular methods. Consumption-2600+0.7Y Tax=200+0.1Y Government Spending-4800 Investment-5000 Exports <-800 Imports-600+0.05Y ) Illustrate and explain how the AE curve changes as we move from a private closed to private open to mixed open economy and also, also what happens to the multiplier

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The following diagram represents an economy in which government spending increases. PPF, PPF2 C2 (0,0) Leisure, I Economists would say that "government spending is creating a crowding-out effect". What does it mean? O Overall production in the economy is decreasing O Although GDP is increasing, private consumption decreases due to the increase in taxes needed to finance the increase in government spending Leisure is increasing, which causes labor income to decrease, which means that consumers can afford less private consumption O Government spending decreases productivity in the economy Consumption, C
Q2) Using the data below derive equilibrium income for : a. A Private Closed Economy.. b. A Private Open Economy: C =C +cY & Ca = C+ C = 100, c= 0.8 cYa I@r= I G= G XN = X - M – mY I= 20 T=20, G = 20, t= 0 m = 0, X = 20, M=10
How would an increase in taxes influence the size of the multiplier in a four sector model?
Study the scenario and complete the question(s) that follow(s):SilesiaYou are provided with the following information about an imaginary economy called Silesia. Use the information provided in the table to answer the questions below.Government expenditure 400 Exports 250 Autonomous imports 50 Autonomous consumption 150 Investment Expenditure 300 Full- mployment output 2040 Marginal propensity to consume 0.75 Marginal propensity to import 0.15 Tax rate 0.25Source: Bester, N. 2017.5.1 Derive and calculate the consumption function for the data provided. Show all formulas and calculations used. 5.2 Calculate autonomous spending. Show all formulas and calculations used.5.3 Calculate the multiplier. Show all formulas and calculations used. Round off your final answer to 1 decimal.
1.How would an increase in taxes influence the size of the multiplier in a four sector model? 2.Briefly describe the concept multiplier.
. Suppose the United States economy is repre- sented by the following equations: Z = C + I + G, C = 500 + 0.75YD, T = 600, I = 300, YD = Y − T , G = 2000 Given the above variables, calculate the equilibrium level of output. assume that government spending decreases from 2000 to 1900. What is the new equilibrium level of output? How much does income change as a result of this event? What is the multiplier for this economy?
Q1: There are two equations for macroeconomic equilibrium in an economy. State them. Show (mathematically) that Savings equals Investment when expenditure equals income. What type of economy would you have when exports equal imports? What happens to the savings-investment relationship if exports are not equal to imports? [This can be greater than or less than]. [Hint: See video lecture on Open Economy Macroeconomics]. Note: Ensure to write out full meanings when you use abbreviations or short forms. This is key to getting full marks.
Suppose the United States economy is represented by the following equations: Z = C + I + G C = 500 + .5YD T = 600 I = 300 YD = Y - T G = 2000 Given the above variables, calculate the equilibrium level of output. Now, assume that taxes increase from 600 to 700. What is the new equilibrium level of output? How much does income change as a result of this event? What is the multiplier for this economy?
What is the definition for the multiplier process
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Agreement and disagreement among economists Suppose that Musashi, an economist from a business administration program in Georgia, and Rina, another economist from a nonprofit institution in the Midwest, are both guests on a popular science podcast. The host of the podcast is facilitating their debate over saving incentives. The following dialogue represents a portion of the transcript of their discussion: Rina: I think it's safe to say that, in general, the savings rate of households in today's economy is much lower than it really needs to be to sustain an improvement in living standards. Musashi: I think a switch from the income tax to a consumption tax would bring growth in living standards. Rina: You really think households would change their saving behavior enough in response to this to make a difference? Because I don't. The disagreement between these economists is most likely due to DIFFERENCES BETWEEN PERCEPTION VERSUS REALITY or DIFFERENCES IN SCIENTIFIC JUDGEMENTS…
The following information is provided about an open economy with a government. Use the information to answer the questions that follow:C = 375 + 0.6YI = 200G = 150X = 50Z = 30 + 0.1YT = 0.15YYf = 1 335.10 Show all your formulasQ.1.1 Calculate the level of autonomous spending in this economy. (2)Q.1.2 Calculate the size of the multiplier.(Note: Round your answer to two decimal places.)(3)Q.1.3 Calculate the equilibrium level of income. (2)Q.1.4 Calculate the change in government spending required to reach full employment in the economy.(3