Question

Part C The following equations characterize an open economy in billions of dollars. C = 100...

Part C The following equations characterize an open economy in billions of dollars. C = 100 + .6 (Y – T) T = 40 I = 48 G = 64 X = 76 M = 20 + .15Y (g) If national income were $400 billion, would inventories be below or above the desired inventories, and by how much to the actual and desired inventories differ? Interpret your result and provide the implication of your answer. 2 marks

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Part C The following equations characterize an open economy in billions of dollars. C = 100...
Part C The following equations characterize an open economy in billions of dollars. C = 100 + .6 (Y – T) T = 40 I = 48 G = 64 X = 76 M = 20 + .15Y (f) If the national income were $340 billion. What is the value of C, M, and S? 3 marks
Part C The following equations characterize an open economy in billions of dollars. C = 100...
Part C The following equations characterize an open economy in billions of dollars. C = 100 + .6 (Y – T) T = 40 I = 48 G = 64 X = 76 M = 20 + .15Y (i) If government expenditures and taxes both increased by $15 billion, what would be the change in equilibrium income?
Suppose the following statistics characterize the financial health of the hypothetical economy Spendia at the end...
Suppose the following statistics characterize the financial health of the hypothetical economy Spendia at the end of 2017: • Gross domestic product (GDP) is equal to $100 billion. • The national debt is equal to $120 billion. • The government has a budget deficit of $9 billion. • The debt ceiling in Spendia is set at $139 billion. The following calculations help you see how the ratio of debt to GDP changes from one year to the next. Complete the...
Consider an economy described by the following equations​ (same equations as previous​ exercise): Y​ = C​...
Consider an economy described by the following equations​ (same equations as previous​ exercise): Y​ = C​ + I​ + G, G​ = 2,000 T​ = 2,000 C​ = 250​ + 0.75YD I​ = 750 ​a) Calculate the expenditure multiplier. A. ​-1.33 B. 1.33 C. ​-4 D. 4 E. 3 F. ​-3 ​b) Calculate the change in Y and the new level of Y if G increases by​ $400. Change in Y​ = New level of Y​ = A. ​-1200 B....
3. Consider an economy characterized by the following equations AE = 10 + 0.75Y - 0.5P...
3. Consider an economy characterized by the following equations AE = 10 + 0.75Y - 0.5P AS: Y = 10 + P where Y is national income, AE is desired aggregate expenditure, P is the price level, AS is the aggregate supply. National income is in billions of dollars. a) What is the equation for the aggregate demand (AD)? Solve for equilibrium P and Y. Illustrate the equilibrium in a diagram with P on the vertical axis and Y on...
An open economy is described by the following system of macroeconomic equations, in which all macroeconomic...
An open economy is described by the following system of macroeconomic equations, in which all macroeconomic aggregates are measured in billions of Namibian dollars, N$. Y = C + I + G + X – M C = 160 + 0.6Yd T = 150 + 0.25Y I = 150 G = 150 E = 300 M = 50 + 0.1Y, Yf = 1500 Where: Y is domestic income Yd is private disposable income C is aggregate consumption spending T is...
Consider an open economy with the following specifications: C= 200 - 0.85Y T= 300 G= 400...
Consider an open economy with the following specifications: C= 200 - 0.85Y T= 300 G= 400 I = 120 X= 40 M= 30 Derive the savings function and show that . MPS + MPC = 1 [3 marks] Define a budget deficit and state whether the government is in a deficit or surplus.                                                                                                                                                          [3 marks] Given that the economy is open, state and explain the components of Aggregate demand (AD).                                                                                                                      [4 marks] Derive the equilibrium income...
. Suppose an economy is represented by the following equations. Consumption function C = 200 +...
. Suppose an economy is represented by the following equations. Consumption function C = 200 + 0.8Yd Planned investment I = 400 Government spending G = 600 Exports EX = 200 Imports IM = 0.1Yd Autonomous Taxes T = 500 Marginal Tax Rate t=0.2 Planned aggregate expenditure AE = C + I + G + (EX - IM) By using the above information calculate the equilibrium level of income for this economy and explain why fiscal policy becomes less effective...
Suppose an economy is represented by the following equations. Consumption function C = 300 + 0.8Yd...
Suppose an economy is represented by the following equations. Consumption function C = 300 + 0.8Yd Planned investment I = 400 Government spending G = 500 Exports EX = 200 Imports IM = 0.1Yd Autonomous Taxes T = 500 Marginal Tax Rate t=0.25 Planned aggregate expenditure AE = C + I + G + (EX - IM) By using the above information calculate the equilibrium level of income for this economy and explain how multiplier changes when we have an...
Assume the following equations summarize the structure of an open economy:           C= 500 + .9...
Assume the following equations summarize the structure of an open economy:           C= 500 + .9 (Y – T)                  Consumption Function           T = 300 + .25 Y                         Tax           I = 1000 – 50 i Investment equation           G = 2500                                   Government Expenditures           NX = 505 Net Export           (M/P)d = .4 Y -37.6 i Demand for Money (i= interest rate)           (M/p) s = 3000                          Money Supply 5- Derive the equation for the LM curve. 6-...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT