B. Suppose that the economy is characterized by the following behavioral equations: • C=240 +0.75 Yd . I 200 G = 200 • • T = 150 a) Identify or solve the following: C1 (1-q₁₂) ●
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- A. Suppose that the economy is characterized by the following behavioral equations: • • C = 160+ 0.6 Yd I = 150 • G = 150 • T = 100 a) Identify or solve the following: • C1 • (1-C₁) . Y • Ya . C • multiplier • A . Z • Sprivate • Spublic b) If the government decides to decrease its spending by 40, ceteris paribus, identify or solve the following: C₁ • (1-C₁) . Y • Yd • C • multiplier . A . Z • Sprivate • SpublicA. Suppose that the economy is characterized by the following behavioral equations: • • C = 160+ 0.6 Yd I = 150 • G = 150 • T = 100 a) Identify or solve the following: • C1 • (1-C₁) . Y • Ya . C • multiplier • A . Z • Sprivate • SpublicIn the goods market when C(Yd) = c0 + c1Yd, the multiplier is bigger when:A. The marginal propensity to consume (c1) is smaller.B. The marginal propensity to consume (c1) is larger.C. The exogenous component of consumption (c0) is larger.D. The exogenous component of consumption (c0) is smaller.E. None of the above.
- Assume that Consumption is C = c(Y-T); Taxes T = tY; Investment / = -bi; and Government expenditure (G) is exogenous. Determine the multiplier for an increase in the tax rate.According to the multiplier concept when there is a change in any one of the components of total expenditures (C, I, G, or X-IM), a multiple impact upon: a) the rate of unemployment will occur. b) saving in the economy will occur. c) household expenditures will occur. d) income will occur.The Average Propensity to Consume is: A. the percentage of disposable income that is consumed B. the percentage of disposable income that is saved C. the percentage of disposable income that is spent D. the percentage of disposable income that is invested
- 7. If a person's income is $40,000, how much do you predict that they will spend on consumption? 8. The R-squared, or coefficient of determination, from this regression is 0.844. Interpret the R-squared.Suppose the following equations represent an economy. What is the multiplier for thiseconomy?Z = C + I + G C = 400 + .5YD YD = Y - T T = 400I = 200 G = 1800a. 0.5.b. 1.c. 1.5.d. 2.e. none of these.Planned aggregate expenditure (PAE, billions of $) 1,400 1,200 1,000 800 600 400 200 0 Actual aggregate expenditure (Y, billions of dollars) Type your answers in all of the blanks and submit X₂ X² Ων 200 400 600 800 1,000 1,200 1,400 The following shows the PAE of an economy. Based on the graph, answer the following: 1. PAE equation is PAE = Type your answer here 2. The equilibrium level of output is $ Type your answer here Type your answer here 3. Suppose that planned investment increases by $200. The new PAE equation is PAE = + Type your answer here Y PAE 4. The new equilibrium level of output is $ Type your answer here 5. The multiplier is Type your answer here Y Type your answer here
- What is the vertical intercept of the consumpation function that represents the portion ofconsumption expenditure not associated with a level of disposable income?a. Consumption interceptb. Disposable income intercept c. Autonomous consumption d. Automatic consumption lineFor the multiplier to be positive what condition must be satisfied?What is the marginal propensity to consume in this economy? Planned Government Net Exports Aggregate Change in Real GDP (Y) Consumption (C) Investment (1') Purchases (G) (NX) Expenditures (AE) Inventories 1500 1100 250 1600 1175 100 1700 1250 1800 1900 2000 75 Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a 0.65 0.75 0.85 d. 0.95