Given consumption = 100 +0.75Yd Tax = 50 + 0.5Y Export = 200 Import = 50 + 0.25Y Government spending = 150 Investment = 200 (a) Determine the value of the economy’s multiplier, which is applicable to government spending, and interpret it.
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Given consumption = 100 +0.75Yd
Tax = 50 + 0.5Y
Export = 200
Import = 50 + 0.25Y
Government spending = 150
Investment = 200
(a) Determine the value of the economy’s multiplier, which is applicable to government spending, and interpret it.
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- If the government spends 10 million and the multiplier is 5, then real GDP will increase by: Group of answer choices 10 million. 20 million. 100 million. 50 million.Review one government policy implemented between 2000-2010 and discuss the multiplier effects it had on the economy.What is the definition for the multiplier process
- = 450 + 0.4Y I = 350G = 150X = 70Z = 35 + 0.1Y T = 0.15YYf = 1550Q.2.1 Calculate the level of autonomous spending in this economy.(2)Q.2.2Calculate the size of the multiplier(Note: Round your answer to two decimal places)(4)Q.2.3Calculate the equilibrium level of income (Hint: use the multiplier method)(2)© The Independent Institute of Education (Pty) Ltd 2020Page 6 of 10 202020Q.2.4Q.2.5Q.2.6Question 3Calculate the tax revenue to the government of this country when the economy (2) remains in equilibrium.Calculate what the new equilibrium income should be if the government of this (6) country decides to cancel all taxes, implying the tax rate would now be 0%.Before the government decreased the tax rate, how much of government spending was required to bring the economy to full employment?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.(3You are given the following information about a closed economy with no government:Consumption = 115 + 0.6YInvestment = 550Use the above information to answer the question: Calculate the value of the multiplier.
- What is the minimum value of multiplier?If the current value of GDP is $13.28 trillion and the government is planning to increase spending by $800 billion (all in one year), the percentage increase in GDP using the multiplier estimate of the first economist is percent. (Round your response to two decimal places.)When the economy is in a recession, the government will want to increase output. If the multiplier equals 2.5 and the government increases spending by 200, how much will output increase by? A) 900 B) 300 C) 500 D) 100
- Use the graph to answer the questions that follow. a.What is the value of the MPC?b.What is the value of the MPS?c.What is the value of the multiplier?d.What is the amount of unplanned investment at aggregateoutput of 300, 900, and 1,300?You are given the following information about a closed economy with no government: Consumption = 115 + 0.6Y Investment = 550 Calculate the value of the multiplier.Increasing government purchases of goods and services would have a bigger multiplier effect on real GDP than decreasing taxes, dollar for dollar. Selected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer. a b True False