a) What type of gap exists in this economy, and how big is that gap? (Select one) $ 0 b) By how much must government expenditures change to eliminate this gap? (Select one) $0 c) Demonstrate this graphically in the graph above.
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- Agricultural price supports result in governments holding large inventories of agricultural products. Why do you think the government cannot simply give the products away to poor people?1-How do you apply the opinion of Prof. Nurkse in Niger on the supply side of vicious circle that “there is small capacity to save resulting from low level of national income?arrow_forward Question Asked Jun 26, 2020 1 views Suppose one thousand (1000) units of product Aare produced by XYZ limited and the quantity demade for the product is two thousand (2000)units .All other things remaining constant,$18 change in price of product A results in change quantity demaded and supplied of 6 and 9 respectively.XYZ limited has a work force of 500 people who Pay income tax of $200 each .Supposed the government introduce a subsidy of $10 on each unit of A produced. Calculate the new equilibrium price and quantity
- (c) The following table is the information of the real GDP and all the expenditures (the numbers are in billions) for Country XYZ. Planned Government Real GDP (S) Consumption ($) Net Exports ($) Investment ($) 350 Purchases ($) 450 4000 3500 -100 5000 4300 350 450 -100 6000 5100 350 450 -100 7000 5900 350 450 -100 (i) What is the equilibrium level of real GDP? (ii) If potential GDP is $7000 billion, is the economy at full employment? If not, what is the condition of the economy? If the economy is not at full employment, by how much should government spending increase so that the economy can move to the full employment level of GDP?(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…58 minutes ago Detions V ot we ep M. ABDEL RAHM.. MMED Heba Mamdouh FFARAH ORAS MARIAM HANY A MERUM YASSER Question 2: MCQ Which of the following would be included in the gross domestic Sroduct of Braza A the profits earned by a U. S owned plant in Brazil Bithe profits earned by a Brazilian coffee company operating in the United States the profits earned by a Brazilian colfee company operating in Peru D the profits earned by U. S suppliers to Brazil operating in the Unite States Bị the profits carned by Peruvian companies operating outside Brazil Paricloants howe Chal Reactana
- Done 17. (Figure: Laffer Curve 3) A supply-side economist is advocating reducing income tax rates. She is probably assuming that the economy is at point Average Tax Rate(%) O d 3 b Chapter 10 Part 2: Homework Problems C Tax Revenues (millions of dollars) in the graph. 1 match C1. (a) The following equations describe an economy: C-100+ 0.75Yd I-50-25r T-G-50 Where C is aggregate consumption, Y is disposable income, I is aggregate investment. I is taxes, G is government purchases and r is the rate of interest. Derive the IS curve for the economy. Show the area of excess demand and excess supply in the goods market. (b) Draw the graph and explain the derivation of IS curve. 2. (a) Given the following data about the monetary sector of the economy: Ma -0.4Y-80r M₁ - 1200 million Where, Ma is demand for money, Y is the level of income, r is the rate of interest and M, is the supply of money. Derive the equation for LM curve and give the economic interpretation of this curve. Show the excess demand and excess supply in the money market. (b) Draw the graph and explain the derivation of LM curve. 3. Consider the following economy: C-100+ 0.8Yd I-50-25, G-T-50 M' P -200 M₁-Y-25r 1. Calculate the IS and LM curves. 2. Calculate the equilibrium levels of output (national…1. Explain the difference between (1) the demand for domestic goods and (2) the domestic demand for goods.
- 10:35 PM A O 60 Aggregate Expenditures Schedule 50 Tools 40 C+1 Equilibrium 30 20 10 10 20 30 40 50 Real GDP (billions of dollars) Instructions: In part b, enter your answer as a whole number. In part c, round your answer to 1 decimal place. b. What is the equilibrium GDP for this country? billion c. What is the marginal propensity to consume for this country? Aggregate expenditures (billions of dollars)1. An economy is characterised by the following equations: C (Consumption) = 60 + 0.9Yd I (Investment) 10 G (Government expenditure) 10 T (Tax) X СЕхрorts) M (трorts) 20 10 + 0.05 Y %3D (a) What is the equilibrium income? (b) Calculate trade balance. (c) What is the value of foreign trade multiplier ?60 + Import favorites How can you find the main idea of this graph? O O O A) Look at the labels on the graph. B) Read the title of the graph. C) Consider the format of the graph. D) Read the data in the graph. Federal Spending in Fiscal Year 2020 Social Security $1.1 Trillion Medicare $769 Billion Medicaid $458 Billion $345 Billion Defense $714 Billion Outlays $6.6 Trillion PPP $526 Billion Unemployment Recovery Compens S473 Billion S Nondefense 5914 on Other $968 Billion