Question

Suppose you discover that you have a rich uncle that will give you millions in the near future. Draw the appropriate shift in autonomous spending on the graph.

Answer #1

Consumption spending = CS

Disposable income is the income after tax.

45 degree line indicates the equilibrium line.

Autonomous spending is the amount of such spending when there is no income; it fulfils basis necessities.

The spending is AE, where the autonomous consumption is “a”, before the discovery.

Once there is a discovery of getting huge amount of money very recently, today’s spending should increase and shift the AE curve to the left as AE1.

The autonomous spending should also be increased to “b”.

6. Suppose 15 year old Willy has saved $5,000. Willy’s uncle
offers to pay him $5,000 if he spends nothing on any legal ‘vice’
activity (gambling, alcohol or tobacco consumption) prior to
Willy’s 21st birthday. Without this monetary incentive, Willy would
choose to spend $6000 on ‘vice’ activities. a) Graphically depict a
situation in which his uncle’s “reward” (or bribe) to Willy for
spending nothing on ‘vice’ activities could have been as little as
$3,000, and yet it would still...

1.Suppose you discover a fossil that is an impression
of an ancient organism. You observe that the organism did not have
any hard cell walls, but did seem to have muscular tissue. Explain
how each of these traits supports or does not support the
classification of the organism as an animal.
List at least three characteristics of organisms in the Domain
Eukarya
1.
2.
3.

Suppose that during an electrophysiology experiment you discover
that the dopamine axons that project to the nucleus accumbens AND
striatum are expressing a mutated form of a voltage gated potassium
channel that is much slower to close than normal. What effect on
addiction related motivated behaviours would this mutation have?
Explain your answer clearly.

Suppose U(x)=x0.5
a. Graph this utility function.
b. Suppose you have a binary lottery with a 40% chance of $25 and a
60% chance of $100. Draw
the probability tree of this lottery.
c. Show the lottery in Part B on your graph from Part A. You need
to show: U(25), U(100), EV,
U(EV), EU, U(CE) and the CE. Be sure to label everything
clearly.
d. What can you say about the CE and EV for this lottery? Why?

Suppose U(X)=15+X.
a. Graph this utility function
b. Suppose you have a binary lottery with a 40% chance of $0 and a
60% chance of $100. Draw
the probability tree of this lottery.
c. Show the lottery in Part B on your graph from Part A. You need
to show: U(0), U(100), EV,
U(EV), EU, U(CE) and the CE. Be sure to label everything
clearly.
d. What can you say about the CE and EV for this lottery? Why?

Suppose that you have the following information for an
economy:
Marginal propensity to consume - MPC
0.80
Autonomous consumption - A
$500
Planned investment - PI
$600
Net exports - NX
-$400
Government spending - G
$300
You will need this information for the questions that
follow.
Part 1:
When real GDP is equal to $4,500, aggregate expenditure is equal
to $ .
Part 2:
When real GDP is equal to $5,000, aggregate expenditure is equal
to $ .
Part 3:
When real GDP...

29. Suppose you have the following balance of payment account
balances for a country (in millions of dollars)
Year
1
2
3
4
5
CA
85
95
115
125 150
FA
-100
-105
-110
-115 -125
For each year calculate the country’s official reserve (OR)
account balance and very briefly (in one sentence)
describe the expected behavior of the real value of its currency
over the five-year period.

Suppose that a city operates two neighborhood schools, one in
the rich neighborhood and one in the poor neighborhood. The schools
are equal in size and currently have equal budgets. The city
receives $10 million in federal grant money that can be used to
supplement the budgets of the two schools, which are initially
identical. For each school, the average score on a standardized
achievement test depends on how many dollars are allocated to the
school. Letting S denote the...

Suppose that a city operates two neighborhood schools, one in
the rich neighborhood and one in the poor neighborhood. The schools
are equal in size and currently have equal budgets. The city
receives $10 million in federal grant money that can be used to
supplement the budgets of the two schools, which are initially
identical. For each school, the average score on a standardized
achievement test depends on how many dollars are allocated to the
school. Letting S denote the...

Suppose you have 100 cards each numbered 1, . . ., 100. Suppose
you shuffle them thoroughly and draw 60 of them, one after another.
What is the probability that you draw them in increasing order?

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 6 minutes ago

asked 6 minutes ago

asked 7 minutes ago

asked 7 minutes ago

asked 9 minutes ago

asked 11 minutes ago

asked 11 minutes ago

asked 16 minutes ago

asked 18 minutes ago

asked 20 minutes ago

asked 20 minutes ago

asked 20 minutes ago