CThe following equations describe an economy C = 100 + 0.75 Y, I= 50 – 25i where C' is aggregate consumption ,Y is disposable income, I is aggre gate investment, T is taxes, G is go vernment purchases and i is the int erest rate. Derive the IS curve for th T= G= 50 e economy.
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- Explain briefly whether each of the following would cause GDP to overstate or understate the degree of change in the broad standard of living. The environment becomes dirtier The crime rate declines A greater variety of goods become available to consumers Infant mortality declinesQUESTION TWOSuppose that the economy of Mwaliteta Republic has the following data for some economic variables. Assume that Mwaliteta Republic has a population of 500,000 people.Variable Amount in million ZMWExpenditure on Non-durable goods 98Non-residential fixed investment 79Central government expenditure 60Local government expenditure 82Expenditure on durable goods 82Expenditure on services 99Export expenditure 60Inventory Investment 5Depreciation 4Property income from abroad 12Indirect taxes 12Residential fixed investment 42Personal income tax…Suppose you have the following disposable income and consumption data for a country, as shown in the table below Disposable income and Consumption BENp e e (dllar 13,000 227,000 3,400 E4,300 1,000 AUsing the information in the table, graph the consumption schedule for this country Instructions Use the tool provided C' to plot the consumption line polnt by point points total. Use the tool Equnibrium to indicate where consumption equals disposable income. Consumption Schedule Conumption (dollarn) 21.000 lave 27000 26000 25000 24.000 23,000 22,000 21000 20,000 20,000 22000 26.000 24.000 28,000 Disposable income (dollars) &What is the stope of the consumpton schedule? Instructions Round your answer to 1 decimal place
- How do i trace this scenario on the circlar flow model, firms inventories unexpectedely rise?Wha t components of GDP (if any) would each of thefollowing tt"a:nsactions affc,: t? Explain.a. Uncle Henry buys a new refrigerator from adomestic manufactu=.b. Aunt Jane buys a new house from a local builder:c. The Jackson famil}' bU}'S an old Victorian housefrom the Walker fan1ily.d. You pay a hairdresser for a haircut.e. Ford sells a Mustang from its inventory to theMartinez family.f. Ford manufactures a Focus and sells il to Avis, thecar rental company.g. Cal.ilornia hires workers to repave Highway JOI.h. The federal government sends your grandmothera Social Securil y check.i. Your parents buy a bo ttle of French wine.j. Honda expands its factory in Ohio.Economics PIODiem set is dde OIT AprTO 1. Let the following equations characterize the economy (note the addition of a tax rate on output): Y = 500 C = 60 + 0.8(Y-T) |= 30 - r G = 100 T = 0.4Y a) Calculate national saving, private saving, and public saving. b) Obtain the mathematical expression for the AD in this particular economy. Draw the graph. c) Determine the equilibrium interest rate (you can use the loanable funds market). Draw the graph for the lonable funds market. d) If Government spending increases to 120, what is the effect on income? Draw the new equilibrium in a graph (old and new in same graph).
- 1. What relationship does the income expenditure model represent? Why is it used?The table below gives date about the economy of countryX, answer the question below given the provided information. lg AE GDP=Y DI G M 40 10 30 15 15 60 10 30 15 15 80 10 30 15 15 100 10 30 15 15 120 10 30 15 15 140 10 30 15 15 160 10 30 15 15 a. Fill in the blanks in the table if T=20 and C= 10+0.75(Y-T) b. What is the equilibrium level of income (GDP)? c. What are the equilibrium values of consumption and saving? d. If taxes increase to 30, what is the new equilibrium GDP?Fluctuation of savings and investment rates impact on GDP of any macroeconomics. Comment with the help of example and graphically as wel
- ces IC raw ill ady Answer five questions given the following data for 2019: The Equivalence of Expenditure and Income (in Billions of Dollars) Expenditure C: Consumer goods and services I: Investment in plants, equipment, and inventory G: Government goods and services X: Exports M: Imports GDP: Total value of output b. Gross private investment d. Exports % c. Total government purchases e. Imports FI Instructions: Enter your responses as a percentage rounded to one decimal place. Calculate the following as a percentage of GDP for 2019: a. Personal consumption expenditures % % % EL Q Search @ F2 A $14,561 # 3,744 3,754 2,504 F3 (3,136) $21,427 F6 A $11,434 2,075 1,658 778 645 1,494 3,463 (120) $21,427 Q F7 & PrtScn 18. * Home F9 FGraphically illustrate the aggregate consumption and saving functions. Explain these functions with at least 200 words. You may give examples.How is interest rate calculated when using intertemporal consumption between two periods. Can a formula be provided, please? Subject area intertemporal consumption (microeconomics) For reference : Income 1 Income 2 Consumption 1 Consumption 2 (How is the interest rate calculated if given the figures for Income 1, Income 2, Consumption 1 and Consunpmtion 2 . Please explain