Question

In a closed economy Y = $18 trillion, national saving = $5.5 trillion, consumption is equal...

  1. In a closed economy Y = $18 trillion, national saving = $5.5 trillion, consumption is equal to government expenditure. What is the government expenditure?
  2. Skyline Chili wants to finance the purchase of new equipment for its restaurants. The firm has limited internal funds, list two options that are available for Skyline to seek the funding.
  3. What do you mean by Kuwait government has a budget deficit for the year 2020?
Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

1) Y=$18 trillion.

National Savings =Y-C-G=>I= $5.5 trillion.

Given G=C, and in closed economy NX=0.

Y=C+G+I+NX

Y=C+G+5.5+0

Y=2G+5.5 =>18=2G+5.5 => 2G=12.5

G=(12.5)/2 => G=6.25

government expenditure G=$6.25trillion.

2)The options for the Skyline Chili for financing the new equipment are

a)Skyline Chili can take loan from creditors for financing the new equipment for restaurant.

b)Skyline can sell bonds and can rise funds for investment.

c)Skyline Chili can sell its shares of company for equity and raise funds for investment.

3)Kuwait government has a budget deficit for the year 2020 is

Kuwait Government Spending is more than the Kuwait Goverment Revenues i.e Government spending is more than the taxes collected by the Government in recent year.

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
GDP is $12 trillion this year in a closed economy. Consumption is $8 trillion and government...
GDP is $12 trillion this year in a closed economy. Consumption is $8 trillion and government spending is $2 trillion. Taxes are $0.5 trillion. What is the government budget balance? (Please show how you got the answer)
Consider a closed economy. Suppose GDP equals $5 trillion, consumption equals $3.25 trillion, the government spends...
Consider a closed economy. Suppose GDP equals $5 trillion, consumption equals $3.25 trillion, the government spends $1 trillion and has a budget deficit of $0.15 trillion. Question14: Use the numbers from the preceding context, but now suppose that the government cuts taxes by $500 billion and that the consumers save 4/5 of the tax cut and spend the other 1/5. Find out the numerical values of taxes,public saving,private saving, and investment,respectively,after the taxcuts. a.0.85, 0.15,-0.90, 0.75 b.0.75,-0.65, 1.40, 0.65 c.0.35,...
In a closed economy, the consumption function is: c = 1.15 + 0.75(y - t) billions...
In a closed economy, the consumption function is: c = 1.15 + 0.75(y - t) billions of 1992 dollars. The tax function is: t = 0.1y + 0.1 billions of 1992 dollars. Planned investment is $1 billion and planned government expenditures are $1.5 billion. Calculate: The equilibrium level of real GDP. 2. Consumer expenditure 3. Saving 4. The investment multiplier 5. The government budget deficit 6. The leakages from and injections into the circular flow of income and expenditure. Do...
1. In a closed economy, suppose GDP equals $21 trillion, consumption equals $13 trillion, the government...
1. In a closed economy, suppose GDP equals $21 trillion, consumption equals $13 trillion, the government spends $7 trillion and has a budget deficit of $800 billion. Find government saving, taxes, private saving, national saving, and investment. Please show clearly how you calculated your final answers, and box/circle your final answers (in trillions of dollars) with proper labels No credit will be given to an answer in incorrect units, in notations that differ from what’s used in the lectures, without...
In a closed economy, given the following: The consumption function C = 0.8(1 – 0.25) Y...
In a closed economy, given the following: The consumption function C = 0.8(1 – 0.25) Y + 12           The average tax rate t = 25% The level of private investment I = 26 The level of government spending G = 14 Where Y is the national income. Calculate the equilibrium level of income and output in the economy. Calculate the expenditure multiplier and show the effect of an increase in government spending and an increase in private investment.
On Sun Island, a closed economy, the consumption function is c = 1 + 0.75(y -...
On Sun Island, a closed economy, the consumption function is c = 1 + 0.75(y - t) billions of 1992 dollars. The government of Sun Island levies taxes of $1 billion a year and buys goods and services worth $1 billion a year. Investment on Sun Island is $0.5 billion a year. 5. If investment increases by $0.25 billion a year, what is the change in real GDP? (3 points) 6. Go back to the initial equilibrium level of GDP....
Saving and net flows of capital and goods In a closed economy, saving and investment must...
Saving and net flows of capital and goods In a closed economy, saving and investment must be equal, but this is not the case in an open economy. In the following problem, you will explore how saving and investment are connected to the international flow of capital and goods in an economy. Before delving into the relationship between these various components of an economy, you will be asked to recall some relationships between aggregate variables that will be useful in...
The country, Hoosier (a closed economy), has the following data: GDP = 12,000, Consumption = 7,000,...
The country, Hoosier (a closed economy), has the following data: GDP = 12,000, Consumption = 7,000, Taxes = 3,000, Government purchases = 4,000. The investment is I = 4,000 – 1,000 r (where r is the real interest rate, for example r = 5%, use r = 5.) a. What is the supply equation? b. What is the demand equation? c. What is the equilibrium interest rate, r, and what are national saving and investment, S and I?
2. A country has national saving of $60 million, government expenditures of $30 million, domestic investment...
2. A country has national saving of $60 million, government expenditures of $30 million, domestic investment of $40 million, and net capital outflow of $20 million. What is its supply of loanable funds? Show your work. . 3. In the open-economy macroeconomic model, the supply of loanable funds equals_______________. The demand for loanable funds comes from ________________ + _________________. 4. If there is a surplus of loanable funds, the quantity demanded is ___________(more/less) than the quantity supplied and the interest...
Suppose that in a closed economy GDP is equal to 11,000, taxes are equal to 2,500,...
Suppose that in a closed economy GDP is equal to 11,000, taxes are equal to 2,500, transfer payments are equal to 500, consumption equals 7,500 and government purchases equal 2,000. What are private saving, public saving, and national saving? a. 1,500, 0, and 1500, respectively b. 1,000, 500, and 1,500, respectively c. 500, 1,500, and 1,000, respectively d. None of the above is correct During the current quarter, a firm produces consumer goods and adds some of those goods to...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT