Refer to the above figure. There is a $100 million unplanned decrease in inventories at an regate output level of $500 million $1,000 million $1,200 million $1.300 million
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- Consider the following table, which shows a household's disposable income and consumption expenditures. All values are expressed in dollars. Compute the marginal and average propensities to consume for each level of income and fill in the table. (Round your responses to two decimal places) Disposable Income (Y) 0 300 600 900 1,200 1,500 Desired Consumption (C) 420 660 900 1,140 1,300 1,620 MPC-ACIAY NA APC = C/Y₂ NA(a) What is the current equilibrium level of national income? = (b) What is the level of injections 5+ 8 + 7= 206 (c) What is the level of withdrawals o 60+5+8+710-70 yoour TR:7bS-? (d) Assuming that tax revenues are 7 billion, how much is the level of savings? 13-50 040 (e) If national income now rises to 80 billion, and as a result, the consumption of domestically produced goods rises to 58 billion, what is the mpca (f) What is the value of multiplier? (g) Given the initial level of national income of 80 billion, now assume that spending on exports rises by 4 billion, spending on investment rises by 1 billion, and government expenditure falls by 2 billion. By how much the national income will change? 83 Q2, You find the following economic data for a closed economy Utopia: Marginal propensity to consume = 0.6, Investment = 30, Governement spending = 20 Government revenues =20 (Tax collection) People will consume a minimum of 10, no matter what their income is. 4=80 2. I=6 1. What is…3. Complete the accompanying table. (a) What is the break-even level of income? How is it possible for households to dissave at very low income levels? Level of output and income (GDP = DI) Consumption Saving MPS АРС APS MPC S182 -$5 207 232 257 10 282 15 307 20 332 25 357 30 382 35
- 1. Describe the shapes of TP, MPL, and APL18. What will be the level of consumption spending at an income level of 36? a) 30 b) 24 c) 28 d) 16 e) 84. (a) If an initial increase in investment of $3 billion results in a $4.5 billion increase in equilibrium real output, what is the size of the spending multiplier? (b) Calculate the MPW for this example.
- What is the expenditure multiplier in this economy? Planned Government Net Exports Aggregate Change in Real GDP (Y) Consumption (C) Investment (ı') Purchases (G) (NX) Expenditures (AE) Inventories 10000 8200 800 11000 9000 600 12000 9800 13000 14000 15000 800 Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a 3 4 C d 10(a) Suppose the price level in an economy rises while the money wage rate remains constant. What happens to the quantity of real GDP supplied. How will this affect the aggregate supply or aggregate demand curve? What if the potential GDP increases? Which aggregate curve is affected and how? (b) Real GDP Consumption Planned Investment Government Purchases Net Exports $1,000 $1,000 $100 $150 -$50 2,000 1,900 100 150 -50 3,000 2,800 100 150 -50 4,000 3,700 100 150 -50 From the table data provided, answer the following questions. The numbers in the table are in billions of dollars. Show all calculations. a. What is the equilibrium level of real GDP? b. What is the Marginal Propensity to Consume? c. What is the multiplier value in this economy? d. If potential GDP is $4,000 billion, is the economy at full employment? If not, what is the condition of the economy? e. If the economy is not at full employment, by how much should government spending…3. Complete the accompanying table. (a) What is the break-even level of income? How is it possible for households to dissave at very low income levels? Level of output and income (GDP = DI) Consumption Saving АРС APS MPC MPS $205 2$ -$5 230 255 5 280 10 305 15 330 20 355 25 380 30 405 35
- 4. (a) lf an initial increase in investment of $3 billion results in a $4.5 billion increase in equilibrium real output, what is the size of the spending multiplier? (b) Calculate the MPW for this example.36 Refer to the information provided in Table below to answer the question that follow. Planned Output Net Consumption Investment Government Spending (Income) Taxes Spending Purchases 500 1,000 50 100 100 400 150 800 150 50 1,500 2,000 100 1,200 1,600 2,000 150 50 100 150 50 2,500 100 150 50 Refer to Table At an output level of $2,500, there is an unplanned inventory Select one: a. change of $0. b. increase of $200 billion. C. decrease of $200 billion. d. increase of $300 billion,Please no written by hand solution 1. Explain the basic idea of the expenditure multiplier and also discuss the role consumer's play in determining its magnitude. (Minimum 150 words)