Q: Respond to all parts of the question. In your response, use substantive examples where appropriate.…
A: Answer 1. In the image above, it is given automatic expenditures that are consuming a growing share…
Q: Which types of budget cuts only reduce areas that have overspending? Group of answer choices…
A: Budgets refers to the preparation of the spending plans based on the income. Budgets are prepared by…
Q: Suppose a state aims to make it easier for people to purchase school supplies for children by…
A: Sales tax holiday refers to the limited time period where sales tax is reduced or waived off on few…
Q: What is a budget surplus? Outline the benefits and use of a budget surplus in macroeconomic…
A: The government expenditure level and the amount of tax collection determine whether the government…
Q: Refer to Figure 13-1. Ceteris paribus, a decrease in personal income taxes would be represented by a…
A: A decrease in the personal income taxes will increase the disposable income of the consumers. This…
Q: Since the year 2000, the U.S. government has always been running a budget surplus. A. This statement…
A: The federal budget is used to establish financial priorities, such as social security, military, and…
Q: Apply the AD/AS model to discuss whether or not discretionary increases in government purchases…
A: Expanded/ Increased government spending is probably going to cause an ascent in total interest (AD).…
Q: The economy is at full employment, with fairly low levels of unemployment and inflation. What is…
A: Answer: A budget surplus occurs when the government revenue is more than the government expenditure.…
Q: What is true about the balanced budget multiplier? A. The balanced budget multiplier is positive…
A: The balanced budget multiplier is the budget situation where the spending of the government and the…
Q: Tax Revenue and Marginal Tax Rates: Laffer Curve 31. The Laffer Curve is a critical component in the…
A: Answer to the question is as follows :
Q: Define the Tax Multiplier and the Balanced Budget Multiplier.
A: The multiplier measures the amount by which equilibrium level of income changes when the autonomous…
Q: Which of the following statements is correct? a) From an additional dollar of income the least…
A: Disposable income can be defined as the income available to the consumers after paying the taxes and…
Q: According to the Laffer Curve, the amount of tax revenue A) decreases; low; increased B) increases;…
A: Tax: It refers to the income of the government. The increase in taxes will lead to an increase in…
Q: Explain the difference between the policy preferences function and the indirect utility function.
A: Utility refers to the whole pleasure a consumer derives from eating a product's units. The total…
Q: Now we look at the role taxes play in determining equilibrium income. Suppose we have an economy of…
A: In a closed economy, the equilibrium level of income is attained at Y =Aggregate demand where AD=…
Q: Suppose the tax multiplier in an economy is -3. How will total spending (TS) change when taxes (T)…
A: Since tax multiplier is -3, it means that if T decreases by $1, TS increases by $3. So, When T…
Q: Q#1) Consider the following equations describing the components of demand and equilibrium in the…
A: Equilibrium output is takes place where AE is equals to the Y where AE = C+I+G And the different…
Q: Aina receives a tax refund of P800. He spends P600 and saves P200. Aina's marginal propensity to…
A: Marginal propensity to consume is the change in consumption with change in income.
Q: Which of the following is a correct interpretation of this cartoon? OA. The budget will not be…
A: In economics, the term balanced budget means the revenue and expenditures of a country are the same.…
Q: Describe the following term in your own words. Balanced budget
A: Budget shows the total receipts(income) and total expenditure of the government in a fixed period of…
Q: In the country A , autonomous consumption (CA) is 100, marginal propensity to consume (CY) is 0.5,…
A: The equilibrium is established: Y= C+I+G.
Q: Which of the following is NOT counted in the "G" component of spending a. social security payments…
A: Answer- Need to find- Which of the following is NOT counted in the "G" component of spending…
Q: A balanced budget occurs when government a. outlays exceeds tax revenues. b. tax revenues exceeds…
A: Government budget refers to the legal document which is prepared by a political entity or by the…
Q: Explain how the Covid-19 pandemic impacted on the original budget in South Africa
A: The budget depicts the plan of fiscal consolidation that would be addressing the country's…
Q: decrease in personal saving would be smaller than if they were cut permanently. c. decrease in…
A:
Q: TRUE/FALSE According to the Laffer curve, increases in tax rates always result in less tax revenue.
A: Laffer curve shows graphically the relationship between tax rate and tax revenue.
Q: Given the import function, Z = 300 + 2/3Y, which of the following statements is correct? (2) (a) The…
A: In an economy, import function provides information on the total products and services purchased by…
Q: Suppose the tax multiplier in an economy is -8. If the government wants to lower total spending (TS)…
A: The tax multiplier shows the effect of any change in taxes on the aggregate demand of the economy.…
Q: C= 500 + 0,8Y, tax rate(t)= 0,25, G=1000 ve I= 1200. X= 500, M= 500 + 0,1Y Calculate the…
A: Since you have asked multi parts question, we will provide solution for the first three. Aggregate…
Q: DERIVE the balance budget multiplier
A: When the change in government expenditure is equal to the change in taxes, then the budget is said…
Q: 3. C= 500 + 0,8Y, tax rate(t)= 0,25, G=1000 ve l= 1200. X= 500, M= 500 + 0,1Y. a. Calculate the…
A: a) Y= C+I+G+Xn Y = 500+0.8(Y-.25Y) +1200+1000+500-500-0.1Y Y= 500 +0.8Y - 0.2Y +2200 -0.1Y Y= 2700…
Q: Shortly find the mathematical expression of Lagrangian multiplier of “constrained revenue…
A: Lagrangian multiplier is named after after the mathematician Joseph-Loius Lagrangian. It is a…
Q: consumer is faced with the following utility function, U(x1 x2)=(xp1 1+xp2)1/p, where 0<p<1. The…
A: According to classical demand theory , optimal consumption point is achieved where the slope of…
Q: Equilibrium in the goods market exists when production, Y, is equal to the demand for goods, Z.…
A: Aggregate Production = Y Aggregate Demand (Z) = Consumption Spending + Investment Spending +…
Q: Refer to Figure 4-11 4-11.png. On the Laffer curve shown, which of the following is true? Tax…
A: Answer: D (All of the answer choices are true) Explanation: If the marginal tax rate falls from…
Q: Based on our understanding of the model presented in Ch3, a 5% tax cut in a country with balanced…
A: Balance Budget Every government plans its budgeted revenues and expenses every year. Government…
Q: Equilibrium expenditure occurs where
A: Equilibrium expenditure: The equilibrium expenditure is the level of aggregate expenditure, it…
Q: assume that the price levels for a product is :[11,9,7,4,2], then create a table showing the Qd and…
A: We have to construct an demand and supply schedule for given price.
Q: The three common limitations of discretionary fiscal policy are information lag, decision lag, and…
A: Discretionary fiscal policy is thought to be a very useful mechanism for the administration to…
Q: C is consumer expenditure T is tax revenue Y is aggregate output I is investment expenditure r is…
A: Solve this question with the help of example . This question is IS LM closed Economy
Q: Consider the economy of Citronia, where citizens consume only oranges. Assume that oranges are…
A: The measure that depicts the charges that are levied by government on goods and services being the…
Q: Decide true or false if it is false why it is false ? 1-When the government collects taxes in lump…
A: The impact of a change in income following a change in government spending is called government…
Q: According to the U.S. Office of Management and Budget, the 2011 budget for defense exceeded the…
A: The budget of a government shows that how the revenue of the government will be used in various…
Q: Equilibrium output only occurs when 1) government budget is balanced 2) there are no output gaps 3)…
A: Answer: Correct option: 3 (There is no tendency for output to change) Explanation: The equilibrium…
Q: The following information is provided in relation to the goods market: The consumption function is…
A: Here, given information is: C=R450m + 0.75YD I=R268m G=R150m And, this economy has balanced budget…
Q: The balanced-budget multiplier Select one: O a. is greater than 1. O b. is greater than 0 but less…
A: Balanced Budget Multiplier refers to a situation when change in government expenditure is equal to…
Q: On the first graph, use two purple points (diamond symbol) to connect the two black points (plus…
A:
-
C= 500 + 0,8Y, tax rate(t)= 0,25, G=1000 ve I= 1200. X= 500, M= 500 + 0,1Y.
Calculate the budget balance at equilibrium level of Y.
Step by step
Solved in 2 steps
- Figure 2: Real Personal Consumption Expenditure (annualized growth): 2016-2020 50 25 25 5.0 35 100 -125 03 2005 01 2016 03 2016 01 2017 Q3 2017 03 2018 01 2029 03 2009 01 2020 1. Determine the effect of the subsidy on the consumer's budget constraint 2. Graph the original and the new budget constraints 3. Find the new optimization point and determine the effects of the subsidy m on C, l and N*. Identify the substitution and income effects. 4. Graph the substitution and income effectsTask 5: Consumption as young and consumption as old Now suppose Mary is thinking about her retirement and wants to understand how much to save. Today she can either con- sume or save for retirement. During her young, working life she will make 100.000 euros. Thus, her current budget constraint is Cy + S = 100.000. In her retirement she has no income, only the amount she saved as young. She can save at a rate of (1+r). So, her budget constraint as old is Co = (1+r)S. (a) Write Mary's lifetime budget constraint as plot it in a graph. Tip: Solve for savings while old and substitute in the young budget constraint. (b) Mary's utility from consumption as young and consumption as old is U(Cy,Co) = 1-0 Solve Mary's maximization problem. What is the MRS and the MRT? (c) Suppose Mary wins the lottery while young. What is the effect on her optimal decision for consumption as young and as old? (d) The local bank decided to increase the interest rate on savings. Discuss the effect of this increase…4. "The increase in value would be created by having available one additional unit of a limiting resource at the original cost" is: A) Demand price B) Shadow price C) None of the above 5. The following statements have been made about rolling budgeting: 1) Keep updating the budgeting by adding further an accounting period when the earlier has expired. 2) The variants of the budget are not adjusted to reflect actual levels. Which of the above statements is/are true? A) Only 1 B) 1 and 2 C) None of the above
- Explain the positives and negatives of budgeting strategies?Given the demand and supply function for a product as Q = 1500 - 3P (Demand) Q = 1100 + 2P (Supply) (i) Find the equilibrium Price and Quantity of the product. (ii) If a GST of $50 is imposed on the product, find its effect on the equilibrium Price and Quantity. (iii) Who is more elastic, the consumer or the seller? With the help of demand and supply curve draw a suitable diagram to show the effect of GST on the equilibrium Price and QuantitySuppose that the demand for soft drinks is price elastic and the supply is price inelastic. If the government imposes a sales tax on soft drinks, which of the following will occur in the short run? (A) The tax burden will fall equally on both consumers and producers. (B) The tax burden will fall more on producers. (C) The tax burden will fall more on consumers. (D) The percentage increase in the price of soft drinks will be greater than the percentage increase in the quantity demanded. (E) The percentage decrease in total revenue will be greater than the percentage decrease in the quantity demanded.
- Dollars 200 0 f XMR g hj Output D MC 41) Refer to the diagram. Equilibrium price is A) c. B) d. C) b. D) e. ATCPQ 9.02 Tax revenue is likely to rise due to a higher tax rate if the elasticity of demand is and the elasticity of supply is Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a 0.8; 0.9 b 0.9; 1.1 1.1; 0.9 d 1.2; 1.4In the market for cars, the price elasticity of supply is +1.5, and the price elasticity ofdemand is -0.8. The equilibrium price is $ 30 thousand, and quantity is 120 million.(a) Assuming supply and demand are linear, reconstruct and draw the supply and demandcurves. Label the intercepts.(b) To reduce traffic, the government imposes a $400 tax on cars. What are PB and PS after thetax? What is the new equilibrium quantity? Illustrate them on the same graph.(c) How big is the change in consumer surplus, producer surplus, government revenue, anddeadweight loss?
- Keep in mind that management needs to recognize the demand for their product. While this is an obvious statement, it cannot be over emphasized. For example, the inverse demand for Tires is: P = .1I – 11QD The current market price is $21 and average income (I) is $10,990. Calculate the markets total Demand? Calculate the market’s consumer surplus. Draw the Demand Curve and identify the price quantity and label the axes for price and quantity. Calculate the price elasticity of demand at the equilibrium output. Is the Price elasticity of demand calculated in Question #1c elastic or inelastic? Based on the income elasticity of demand, is this product a normal good or an inferior good?1.In income substitution effects acts in opposite direction, then the total effect on consumption is always negative. (T/F)2) Daniel has the following Jineas Preferences over black tea be) and milk (y) (a) Setup the expenolituse minmization Problem for Daniel. what conditions, (BC) or(NNC) will necessarily be (b) Solve the expenditure Problem and obtain the Compensated and the Cost minimization function when binding at the oPtimum? ū = 40 and P = $6. c) Other Pic attach for Part(c)