$800 AGGREGATE EXPENDITURE (in billions) 600. 400 200 150 125 75 $200 $300 $400 $500 $600 O II and Ill only Oll only O III only Ol only $800 C+I+G C+1 TOTAL INCOME NOTE: C+I+G intersects 45-degree line at 600B; C+1 intersects 45-degree line at 500B Which of the following are true statements about total income? 1. Equilibrium aggregate income is $800 billion. 11. Planned investment is $50 billion. III. NEquilibrium aggregate expenditure is $600 billion.NOTE

$800 AGGREGATE EXPENDITURE (in billions) 600. 400 200 150 125 75 $200 $300 $400 $500 $600 O II and Ill only Oll only O III only Ol only $800 C+I+G C+1 TOTAL INCOME NOTE: C+I+G intersects 45-degree line at 600B; C+1 intersects 45-degree line at 500B Which of the following are true statements about total income? 1. Equilibrium aggregate income is $800 billion. 11. Planned investment is $50 billion. III. NEquilibrium aggregate expenditure is $600 billion.NOTE

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter9: Aggregate Demand

Section: Chapter Questions

Problem 4.8P

See similar textbooks

Similar questions

GDP $0 1 2 Consumption $0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 D 8 4.5 As shown in Exhibit 9-1, if equilibrium GDP is $5 trillion, then the total of investment, government spending, and net exports is: 8 4.5 As shown in Exhibit 9-1, if equilibrium GDP is $5 trillion, then the total of investme O $1 trillion. $2 trillion. O $3 trillion. O $4 trillion. $6 trillion. 4 Aggregate Expenditures 6 Unplanned inventory
2. In macroeconomic theory, total or aggregate spending is denoted by A and total or aggregateproduction of income by Y. Which one of the following statements is incorrect? A When A is greater than Y, there is disequilibrium and Y will tend to increase.B When A is equal to Y, there is equilibrium and Y will remain unchanged.C When A is less than Y, there is disequilibrium and Y will decrease.D When A is greater than Y, there is disequilibrium and A will decrease.
Gross Real GDP (after taxes) Investment $10 10 ITTIT 20 10 10 10 10 10 10 40 70 100 130 160 Consumption $-20 100 K Net exports +5 45 Government purchaies $15 7. Refer to the above table. If the full-employment real GDP is $70 the 15 15 15 15 15 15 OA) A. inflationary expenditure gap is $30. OB) B. recessionary and inflationary expenditure gaps are both $0. OC) C. inflationary expenditure gap is $10. OD) D. recessionary expenditure gap is $10.
Table 1 All Numbers are in $ Billion Output Consumption (Income) Spending 400 800 1,200 1,600 2,000 Net Taxes 100 Investment Government Spending Spending 400 200 100 700 100 1,000 1,300 200 200 100 100 100 le 100 200 100 1,600 100 200 100 Refer to Tablel above. At an output level of $1,200 billion, there is an unplanned inventory change of Lütfen birini seçin: O A. negative $10 billion. O B. zero. O C. positive $10 billion. O D. negative $100 billion O E positive $100 billion
1.In Figure 1, when disposable income is 0, how much is consumption, saving, autonomous consumption, and induced consumption? 2.In Figure 1, when disposable income is 2500, how much is consumption, saving, autonomous consumption, and induced consumption? 3.In Figure 1, when disposable income is 4,000, how much is the consumption, savings, autonomous consumption and induced consumption?
ADVANCED ANALYSIS Assume that the consumption schedule for a private closed economy is such that consumption is: C = 100 + 0.75Y Assume further that planned investment Ig is independent of the level of real GDP and constant at Ig = 50. Recall also that, in equilibrium, the real output produced (Y) is equal to aggregate expenditures: Y = C + Ig Instructions: Enter your answers as whole numbers.a. Calculate the equilibrium level of income or real GDP for this economy. Equilibrium GDP (Y) = $ . b. What happens to equilibrium GDP if Ig changes to 60? Equilibrium GDP (Y) = $ . What does this outcome reveal about the size of the spending multiplier? Spending multiplier = .
The diagram below shows the consumption schedule for a private closed economy. The level of planned investment is $6 billion. a. Using the diagram, draw the aggregate expenditures schedule for this economy and then identify equilibrium GDP. Instructions: (1) Use the tool provided 'C + I'to draw the aggregate expenditures schedule for this economy. (2) Use the tool provided 'Equilibrium' to identify the new equilibrium GDP. 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) 18
Suppose a given hypothetical economy has the following values. GDP-520 Billion, Consumption =$13 Billion; Govermment Purchase-$4 Billion; and Budget Surplus = $1 Billion How much is the public saving? OA S5 Bilion OB $4 Blion OC.52 Billion OD-$1 Billion OE S1 Billion OF $3 Billion
100 gaia 270 200 130 60 450 100 200 300 Aggregate income (Y) Figure 8.3 ?Refer to Figure 8.3. Which of the following statements is true „Aggregate saving is negative for all income levels below $400 a O For all aggregate income levels above $200, aggregate consumption is greater than aggregate income b O If consumption is the only expenditure, this economy would be in equilibrium at an aggregate income level of c O $300 Saving is negative at all income levels below $200 d O Aggregate consumption (C)
Given the following consumption function, C = 400 + 0.75YD,where C= consumption expenditure, YD = disposable income, Investment= $1200, Government spending = $1600,Exports = $500, Imports = $600, Taxes = $1200 and Potential GDP = $9000Choose corrcct optiona) Aactual output is less than potential outputb) actual output is zeroc) actual output is equal to potential outputd) actual output is higher than potential output
10.pr3 Following is a saving and investment schedule indicating that planned investment is constant 360 11 13 15 17 15 15 15 15 15 a) The equilibrium real GDP is $And saving and investment are both b The MPS and the multiplier is AS2 rise in the g schedule will cause real GDP to tie by S d) Use the investment schedule given in the table and assume a 52 increase in the saing schedule in the table that is, saving at every real GOP increase by S and at this real GOP, saving 4.1. Equilibrium real GDP will to.5 15 will be S d.2. The amount by which real GDP changes depends on the size of the change in the saving schedule and the size o
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)