Please answer the following questions based on the giveninformation: a = 50, MPC -0.8, 1-100, G-200, EX-100,IM- 50 (where a is the autonomous spending. MPC is themarginal propensity to consume, I is the investment, G is thegovernment spending, EX is the export, and IM is the import)1) What is the equilibrium level of output (income), Ye, in thiseconomy? 50AggExpenditureC+I+G+NX-M+I+G+NXpAggExpenditureIncome (Real GOP)2) Suppose the Ye(actual GDP) that you derived from theprevious question is lower than the potential GDP level.Calculate the G' value to find how much the governmentspending is required to reach the potential GDP at 2,400? G48degreeP" =>↑C++G+NxxAus GDPAET-CH-GNXAEZ-C+I+G+NXY, GDP)

Aggregate demand is the sum of Consumption, Investment, government spending and net export.…

Please answer the following questions based on the given information: a = 50, MPC -0.8, 1-100, G-200, EX-100, IM = 50 (where a is the autonomous spending, MPC is the marginal propensity to consume, I is the investment, G is the government spending, EX is the export, and IM is the import) 1) What is the equilibrium level of output (income), Ye, in this economy? 50 V C+I+G+NX- M+I+G+NX Agg Expenditure Income (Real GOP) 2) Suppose the Ye (actual GDP) that you derived from the previous question is lower than the potential GDP level. Calculate the G' value to find how much the government spending is required to reach the potential GDP at 2,400? G 48 Agg Expenditure degree P" => ↑ C++G+Nxx Atus GDP AET-C+I+G+NX AEZ-C+I+G+NX Y, GDP)

Please answer the following questions based on the given information: a = 50, MPC -0.8, 1-100, G-200, EX-100, IM = 50 (where a is the autonomous spending, MPC is the marginal propensity to consume, I is the investment, G is the government spending, EX is the export, and IM is the import) 1) What is the equilibrium level of output (income), Ye, in this economy? 50 V C+I+G+NX- M+I+G+NX Agg Expenditure Income (Real GOP) 2) Suppose the Ye (actual GDP) that you derived from the previous question is lower than the potential GDP level. Calculate the G' value to find how much the government spending is required to reach the potential GDP at 2,400? G 48 Agg Expenditure degree P" => ↑ C++G+Nxx Atus GDP AET-C+I+G+NX AEZ-C+I+G+NX Y, GDP)

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter11: Fiscal Policy

Section: Chapter Questions

Problem 11E

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