4. Multiple Choice Question.Which of the followingare likely the short-run effects of an increase in the reserverequirements (A0 > 0)? (Assume that the economy is ini-tially at the natural level.)¹A. Yn(-), C(↓), Y(↓), I(↓), i(†)B. Yn(↓), C(-), Y(↓), I(?), i(-)C. Yn (?), C(↓), Y(?), I(-), i(↓)D. Yn (1), C(?), Y (†), I(†), i(t)¹Note the following notation: natural level of output (Yn), consumptionthe unemployment rate (u); furthermore, the symbols ↑, , , ? refer to in2Consider Footnote 1 as regards the notation.

Reserve requirement is a tool of monetary policy by which a central bank legislates a minimum amount…

4. Multiple Choice Question. Which of the following are likely the short-run effects of an increase in the reserve requirements (A0 > 0)? (Assume that the economy is ini- tially at the natural level.)¹ A. Yn(-), C(↓), Y(↓), I(↓), i(t) B. Yn (↓), C(-), Y(↓), I(?), i(-) C. Yn (?), C(↓), Y(?), I(-), i(↓) D. Yn (1), C(?), Y (↑), I(†), i(t) 1Note the following notation: natural level of output (Yn), consumption the unemployment rate (u); furthermore, the symbols T, , , ? refer to in 2Consider Footnote 1 as regards the notation.

4. Multiple Choice Question. Which of the following are likely the short-run effects of an increase in the reserve requirements (A0 > 0)? (Assume that the economy is ini- tially at the natural level.)¹ A. Yn(-), C(↓), Y(↓), I(↓), i(t) B. Yn (↓), C(-), Y(↓), I(?), i(-) C. Yn (?), C(↓), Y(?), I(-), i(↓) D. Yn (1), C(?), Y (↑), I(†), i(t) 1Note the following notation: natural level of output (Yn), consumption the unemployment rate (u); furthermore, the symbols T, , , ? refer to in 2Consider Footnote 1 as regards the notation.

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter16: The Influence Of Monetary And Fiscal Policy On Aggregate Demand

Section: Chapter Questions

Problem 8PA

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ASAP
3. What impact will budget deficits have on the exchange rate value of the dollar? How will this impact net exports and aggregate demand? Explain
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9.)In an economy with no government and no foreign sec- tors, autonomous consumer spending is $250 billion, planned investment spending is $350 billion, and the marginal propensity to consume is 2/3. a. Plot the aggregate consumption function and planned aggregate spending. b. What is unplanned inventory investment when real GDP equals $600 billion? c. What is Y*, income-expenditure equilibrium GDP?
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1) Assume that Canadian government taxes away $0.15 of each dollar of new income, that 35% of the remaining $0.85 of disposable income is spent on imports, and that 2% of disposable income is saved. Enter your responses below rounded to 2 decimal places. a. The marginal propensity to withdraw is . b. From each new dollar of income $ is spent on domestic consumption items.c. The value of the Canadian spending multiplier is . 2) In each case below a particular fiscal policy affects an economy's AD curve via the spending multiplier. Calculate the spending multiplier and find the direction and size of the shift in the AD curve. Enter your responses for the spending multiplier rounded to 2 decimal places, and size of the shift of the AD curve rounded to 1 decimal place. Do not put minus signs in your answers. a. If government purchases increase by $3 billion in an economy with an MPW of 0.65 then the spending multiplier is and the AD curve finally shifts to the by $…