5. Briefly explain whether you agree or disagree with the following statement: "Real GDP is currently $17.2 trillion, and potential GDP is $17.4 trillion. If the president would like to increase the government purchases by $200 billion or cut taxes by $200 billion, the economy could be brought to equilibrium at potential GDP."
Q: explain why the positive externality associated with the production of a pure public good implies…
A: Externalities are side effects which are borne by the third parties. Externalities could be…
Q: 5,000,000 Japanese yen 60 days from now. You decide to hedge your position by selling Japanese yen…
A: *Answer:
Q: For the demand function (image 1) and supply function (image 2) a) the equilibrium price is: b)the…
A: Answer: Given, Demand function: fx=x-82 Supply function: gx=x2 (a). Let us equate the demand and…
Q: You are looking for a car to lease. Your income is $3,000 per month, and you know that you should…
A: Answer: Given, Monthly income = $3,000 20% of income=3000×2010020% of income=600Total money for car…
Q: This simulation generates random outcomes for probabilistic factors which imitate the randomness…
A: In an economy, there are different concepts used to explain different market and economic…
Q: A 10 percent increase in the price of good A leads to a 20 percent decrease in the quantity of good…
A: Elasticity of demand measures the extent to which quantity demanded changes according to the price…
Q: 1. Pareto Optimality: B A X, M Private Goods and Services per Year 1.1 From the Production…
A: Answer 1.1 Pareto efficiency, also known as Pareto optimality, is an economic state in which…
Q: A piece of equipment is purchased for $13,000. It is expected to last 5 years and has a salvage…
A: The Annual Capital Cost is the sum of all annual amounts based on the amortization of the Capital…
Q: Draw the Lorenz curve and calculate the Gini coefficient for two countries based on the following…
A: In economics, the Gini coefficient, additionally the Gini list and the Gini proportion, is a…
Q: 4. A decorator, who is a monopolist, makes two types of specialty picture frames. From experience,…
A: 4)
Q: . Explain the difference between (1) the demand for domestic goods and (2) the domestic demand for…
A: Domestic goods are defined as those goods which are produced within the boundary of a country. It…
Q: First, write out the expression for the real exchange rate. Second, explain all factors that…
A: The real exchange rate represents the value of a nation's currency with respect to the currency of…
Q: 3. To advertise or not to advertise Suppose that Expresso and Beantown are the only two fims that…
A: The dominant strategy is the best procedure picked by players. At the point when the two players…
Q: Which of the following is a potential operating instrument for the central bank? Question…
A: GDP is the market value of final goods and services by an economy during a given period of time.…
Q: A fam han the production function F(L, K)- 2 min(L, 10K). The curent input level in (L. K)- (12, 1).…
A: The marginal product of capital (MPK) measures the change in output produced due to the change in…
Q: A country's economy is close to full employment. The government then decides to launch a tax cut…
A: The economy is at full employment when it uses all its resources efficiently.
Q: Suppose South Africa’s population comprise 18 000 000 people who are unemployed, 23 000 000…
A: The labor force population includes all who are in the age category of 15 to 65 years and are either…
Q: Someone who wants to buy a car can buy either a used car or a new car. According to the supply and…
A: Supply and demand are influenced by the various factors like Supply of goods is influenced by one…
Q: H applied for a individual major medical policy. When H filed a claim within the first year of…
A: In the insurance market, there are different forms of insurances, based on different requirements of…
Q: The following graph displays Bars indifference curves: Pepsi Coke a. What type of utility function…
A: Disclaimer :- as you posted multipart questions we are supposed to solve the first 3 questions only…
Q: Market for Clothing in CambodiaConsumer SurplusProducer SurplusPrice of ClothingQuantity of…
A: (Since you have asked many questions, we will solve the first one for you. If you want any specific…
Q: Discuss the measures that the UK government are taking to mitigate tax avoidance and tax evasion?
A: One sign of tax evasion is the amount of unreported income, which is the difference between the sum…
Q: Macroeconomists would suggest that an economy experiencing high unemployment should adopt policies…
A: Macroeconomists deals with national issues like unemployment, GDP and Inflation
Q: Please define in your own words the following terms: contractual savings institution, hedge fund,…
A: Contractual savings institutions: The contractual savings institutions are those that generally keep…
Q: please do not give plagiarised answer make answer unique thnku in advance
A: The government is the institution that plays an important role in controlling economic growth. The…
Q: Keynes's model of the demand for money suggests that velocity is related to A. negatively, interest…
A: Keynes does not believe that velocity of money is constant, he firmly believes that velocity of…
Q: 9. The treasurer of XYZ Corp. knows that the company will need to borrow $100 million in one year…
A: Derivatives refer to a contract that derives its value from the performance of an underlying entity.…
Q: Estimates for one of two process upgrades are as follows: First Cost = Php 40,000 Annual Cost = Php…
A:
Q: Consider two economies, one called the domestic country and the other the foreign country. Given the…
A: Balance of Payment = Credits received from foreign country - Debit paid to foreign country Domestic…
Q: A man managing a restaurant for $20,000 per year decides to open his own diner. His revenue during…
A: Every business has two types of cost, implicit and explicit
Q: Consider a 2-good economy with a rational consumer who has weakly monotone and weakly convex…
A: Hicksian Demand function is defined as a demand function which shows the reaction of an economic…
Q: In an oligopoly market, the firms would earn the highest profit if they chose to ignore the actions…
A: An oligopoly market is one where few large firms capture the whole market and sell output to earn…
Q: 1. Do you think Metro Manila qualifies as a global city? 2. What do you think are the problems that…
A: A global city has huge aggressive benefits and serves as a hub in a globalized monetary system. They…
Q: Apply the properties of functions to correctly determine and interpret the break-even point in the…
A: The equilibrium price is the price at which the demand for goods and the supply of goods will be…
Q: risk of loss: lose 10 with probability 0.4 and lose 5 with probability 0.6. They are considering…
A: risk of loss: lose 10 with probability 0.4 and lose 5 with probability 0.6.
Q: 10. The opportunity cost of making cupcakes is lowest at which point? a A 6. 8 d. A and C 11. The…
A: ANSWER IS GIVEN BELOW
Q: The purpose of the coordination of benefit clause found in group policies is to: A: promote over…
A: The Coordination of Benefits (COB) clause in group policies is included to eliminate duplication of…
Q: The entire market for a good is 1,000 units, and the minimum efficient scale is 5 units. Which of…
A: When talking minimum efficient scale, it is the level of output at which a firm is producing at its…
Q: In the context of Small and Medium scale Enterprises, critically examine the influence of…
A: Small and Medium scale Enterprises plays an important role in solving the problem of unemployment…
Q: Essay Problem 1. There is $9,000,000 of curency in Colnland, which are all held by the Bank of Coco…
A: Answer: Given, Total currency held by Coco Bank = $9,000,000 Desired or required reserve ratio = 0.2…
Q: Question 3 of 10 Given the piecewise function shown below, select al of the statements that are true…
A: a piecewise-defined function is a function defined by various sub-functions, where each sub-function…
Q: SA inflation eases slightly in January Inflation eased to 5.7% in January, down from 5.9% the month…
A: Inflation focuses on the quantitative measure of the rate at which the prices of specific goods and…
Q: An automobile tire manufacturer collected the data in the table relating tire pressure x (in pounds…
A: Answer: Given, x Mileage f(x) 28 43 44 30 51 51.9 32 56 55.1 34 50 53.5 36 47 47.3…
Q: our enterprising uncle opens a sandwich shop that employs 7 people. The employees are paid $6 per…
A: A firm hires optimal labor at the following point in order to maximize profit. i.e., MPL = W / P…
Q: The diagram below shows demand and supply curve for Kimchi. The government imposes per-unit of tax…
A: The initial demand curve is D0 and the supply curve is S0 So the initial equilibrium occurs at the…
Q: Discuss why the expectations-augmented Phillips curve can explain what has happened to the…
A: According to the Phillips curve, inflation and unemployment are inversely related: as unemployment…
Q: Nikki owns a business that imports several types of products from countries that have poor economic…
A: If there are more employment opportunities available then this may lead to improve the economic…
Q: In 2016, country A faced unfavorable weather conditions. Wheat production decreased to 450kg.…
A: Answer (4): Note: Answer 3 is correct thus I am not solving that. Let us use the output approach to…
Q: QUESTION 2 Which of the following is NOT a potential explanation for involuntary unemployment?…
A: In an economy, involuntary unemployment refers to the situation when an individual actually wants to…
Q: Question 2 population 12, group B has population 12 and group C has population 4. Each person in…
A: According to the question, A region has 28 people in three income groups A, B, and C. Group…
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
- 4. a) Draw a TP-TE (or Keynesian cross) graph for South Africa. Suppose Real GDP is $425 billion while the Real GDP where TE=TP is $475 billions. total, Expenditure (billions) TE-TH HEL th I 1 45 425 Q2 475 Q1 TP - TE total Production (billions) b) If Real GDP is $425 billion, what will happen to inventories, to firm's production and to the Real GDP? Inventories will decrease and Production will increase GDP increases to $475 billion and realFigure 3-3 45° Planned Expenditure 200 + 0.75Y 45 Income (Y) In the figure above: a. Find the equilibrium GDP. What happens to the left of that equilibrium? What happens to the right? b. When income is $1,000, what is the unplanned inventory? c. What is the GDP multiplier? d. What is the tax multiplier? e. How much should government expenditures increase if the government wants to increase GDP from the equilibrium level found at point a) to 1,000? f. How much should taxes decrease if the government wants to increase GDP from the equilibrium level found at point a) to 1,000? Planned Expenditure3. Suppose an economy had aggregate demand components with the following relationships: Consumption Spending, C-140 +0.60*(DY) Investment Spending, I-25 +0.15"Y Government Spending, G-0 Net Export Spending, X=0 Tax Collections, Tx = 0 a. What is the equilibrium income for this economy (Show your work)? b. If the Government decided to Increase G spending by 6, what would be the new equilibrium income for this economy (Show your work)? Page 2 bed tooing c. If instead the Government decided to Reduce Tx (taxes) by 10 (i.e., send checks to people), what would be the new equilibrium income for this economy (Show your work)? d. If instead the Government decided to Increase G spending and Increase Tx (taxes) by 20, what would be the new equilibrium income for this economy (Show your work)?
- 10:35 PM A O 60 Aggregate Expenditures Schedule 50 Tools 40 C+1 Equilibrium 30 20 10 10 20 30 40 50 Real GDP (billions of dollars) Instructions: In part b, enter your answer as a whole number. In part c, round your answer to 1 decimal place. b. What is the equilibrium GDP for this country? billion c. What is the marginal propensity to consume for this country? Aggregate expenditures (billions of dollars)Question 41 The following equations describe the economy: C= 150 + 0.9Yd | = 150 G = 250 X 200 IM = 0.06Y T= 0.1Y At the equilibrium level of GDP, net exports are equal to a).-180 O b) - -20 Oc) 200 O d) 20 Next Page Previous Page Question 40 The following equations describe the economy: C = 150 + 0.9Y | = 150 G = 250 X 200 IM = 0.06Y T= 0.1Y In equilibrium GDP is equal to a) 3,000 b) 750 Oc) 3,750 O d) 7,500Use the table below to answer the following questions. Real Consumptio GDP n $300 310 320 330 340 350 360 $290 298 306 314 322 330 338 (a) What is the size of the multiplier in this economy? Now, calculate the multiplier when the MPS is .5, .25, .10. What is the relationship between MPS and the multiplier? (b) If taxes were zero, government purchases were $10, investments $6, and net exports were zero, what is the equilibrium GDP? (c) If taxes are $5, government purchases are $10, investment is $6, and net exports are zero, what is the equilibrium GDP? (d) Assume that investment, net exports, and taxes are zero. Government purchases are $30, and the full-employment GDP without inflation is $330. How much must government spending be reduced to eliminate the inflationary expenditure gap?
- 5 The graph shows aggregate expenditures for the fictitious country of Carpistan. Suppose the government of Carpistan increases government expenditures in order to boost the economy. Move the appropriate curve or curves to show the effect of this increase. Next, place point A to show where actual aggregate expenditures equals planned aggregate expenditures. Aggregate Expenditures (AE) 10 9 5 0 1 3 4 D Real GDP (Y) 16 7 11 YAB AR 2.0 10How would a dramatic increase in the value of the stock market shift the AD curve? What effect would the shift have on the equilibrium level of GDP and the price level?GDP $0 1 2 Consumption $0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 D 8 4.5 As shown in Exhibit 9-1, if equilibrium GDP is $5 trillion, then the total of investment, government spending, and net exports is: 8 4.5 As shown in Exhibit 9-1, if equilibrium GDP is $5 trillion, then the total of investme O $1 trillion. $2 trillion. O $3 trillion. O $4 trillion. $6 trillion. 4 Aggregate Expenditures 6 Unplanned inventory
- 2. From what was learned in class, explain what the values of the slope and vertical intercept of the aggregate consumption function mean from an economic perspective. Income-expenditure equilibrium Using the data in the following table to complete the following questions. GDP YD Planned (billions of dollars) $0 $0 $200 $100 400 400 500 100 800 800 800 100 1,200 1,200 1,100 100 1,600 1,600 1,400 100 2,000 2,000 1,700 100 2,500 2,500 2,000 100 3,000 3.000 2,300 100 1. Complete the columns for AEPlanned and unplanned in the table. 2. What is the value of the MPC? 3. What is the aggregate consumption function? AE Planned Unplanned 4. What is the equation for the planned aggregate expenditure function? 4. 5. What is the value of income-expenditure equilibrium GDP, (Y*)? 6. Explain in economic terms what happens when not in the income-expenditure equilibrium? Both when GDP > AE planned and GDP < AE planned. For each situation what needs to happen to move the economy toward equilibrium?.The table contains information about the nation of Syldavia. There are no income taxes or imports in this nation. Consumption expenditure, C (billions of 2012 dollars) Government Real GDP, Y (billions of 2012 dollars) Investment, / (billions of 2012 dollars) expenditure, G (billions of 2012 dollars) 15 6. 20 10 25 14 30 18 35 22 The equilibrium expenditure is O A. $20 billion. O B. $30 billion. O C. $15 billion. O D. $10 billion. O E. $25 billion.graph below shows the economy oOT Japan. Planned Aggregate Expenditures 2400- 2100 1800- 1500 1200 AE 900- 600 AE Y 300- Potential Output 00 200 tobd 200d 2400 40 Reset Real income (in dollars) a) What type of gap exists in this economy, and how big is that gap? (Select one) $ 0 b) By how much must government expenditures change to eliminate this gap? (Select one) $ 0 c) Demonstrate this graphically in the graph above. Real aggregate expenditures (in dollars)