1 You are shown the statements below.Which of the following is/are true?Statement 1: During a recession, theeconomy experiences rising employmentand falling income.Statement 2: Over the business cycleconsumption fluctuates more thaninvestment.Statement 3: A business cycle refers torecurrent swings in real GDP.A. Statements 2 and 3 are true.B. None of the statements are true.C. Only Statement 3 is true.D. Statements 1 and 2 are true.Е.All the statements are true.

Meaning of Business Cycle: The term business cycle refers to the measurement of whether an economy…

Answered: You are shown the statements below.…

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter19: Measuring Economic Performance

Section: Chapter Questions

Problem 7P

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"During a recession more people qualify for unem ployment insurance . This will increase the government spending category of GDP and help reduce the sever ity of the recession " Do you agree with this statement ? Why or why not
Please give a detailed solution with an explanation. Please double-check your sources and make sure the answer is 100% correct. Make sure all questions are answered too.Blank Answer #1:value of all goods and services produced in the economy in the base yearcost of a given market basket of goods and servicesvalue of all goods and services produced in the economy this yearBlank Answer #2:this year's pricesthe base year's pricesBlank Answer #3:value of all goods and services produced in the economy in the base yearcost of a given market basket of goods and servicesvalue of all goods and services produced in the economy this yearBlank Answer #4:this year's pricesthe base year's pricesBlank Answer #5:produced domesticallybought by consumers
Respond the following statements by explaining whythey are true or false. For each statement, a complete and correct explanation 1. Business cycles are the periodic peaks and troughs of the financial industry and real estate (FIRE)sector of the economy. 2. Consumption of nondurables is more volatile than GDP, that is, it has a higher standard deviation, becausepeople like to take risks, so their consumption in nondurables varies more than their income month-tomonth. 3. Investment is countercyclical because, when GDP increases, consumption increases andinvestment falls. 4. Unemployment is countercyclical because the unemployment rate is negatively correlated withGDP.
1. Country X has following data: C = 20 + 0.8Y4, I = 30, G = 40, Tx = 20, T, = 15, X = 60, M = 20 + 0.04Y, incoming year growth target is 600, All figures is billion. Please calculate: a. National income equilibrium! b. Consumption and saving equilibrium! c. Government income from tax! d. How much change in government consumption if they want to achieve growth target?
What is stagflation?
Please answer all the questions. Thank you. 1. You are shown the statements below. Which of them is/are true? Statement 1: The business cycle is always measured using the gross national product (GNP) rather than gross domestic product (GDP).Statement 2: Purchases of new equipment (gross fixed capital formation) are a major component of investment.Statement 3: Investment is less stable than consumption spending by households. A.All three statements are true. B. Only Statement 3 is true. C. Statements 1 and 3 are true. D. Statements 2 and 3 are true. E. None of the statements is true. 2. You are shown the statements below. Which of them is/are true? Statement 1: When the financial account balances, the merchandise trade balance will be the same as the current account balance.Statement 2: Exports of goods and services are recorded in the financial account of the balance of payments.Statement 3: Income derived from holding financial investments flow through the current account. A.…
"The following chart indicates the aggregate demand (AD) and short-run aggregate supply (SRAS) schedules of decision- makers for the current period. Both buyers and sellers previ- ously anticipated that the price level during the current period would be P 105 a. Indicate the quantity of GDP that will be produced during this period. b. Will it be a long-run equilibrium level of GDP? Why or why not? c. What will the relationship between the actual and natural rates of unemployment be during the period? Explain 20 your answer.
1. Real GDP can be decomposed into Trend and Cycle, where the Trend captures the ______________ of the economy.
T/F Economic recessions are characterized by a decline in economic activity, including GDP, employment, and investment..
An economy with NX = 20 - .1Yhas G = 30and a direct tax of 25%. A stock market crash shatters confidence. Households %3| decrease consumption from C = 20 + .8YDTO C = 10 + .8YDand firms lower investment from | = 30to | = 20. Provide diagrams and complete the table with numbers. a. Provide a pair of diagrams to show how the crash affects AE Aggregate Expenditure and NS National Savings. Denote ĠDP before the crash as yo and after the crash as y1. b. On the same diagrams illustrate how the equilibrium would be change if the government responded by increasing spending from G = 30to G = 50.Show this as equilibrium y2. %3D
Need help with macroeconomic review questions! 1) How does the following transaction affect Canada’s GDP? Unless otherwiseindicated, assume that each of the subsequently mentioned people resides in Canada. (j) James Bond purchases a martini, shaken not stirred, for $12, in Calgary. 2) Consider a country with no government and no international trade. The country’seconomy has fixed prices and interest rates. Let C = 300 and I = 150 + 0.75Y . Whatis this country’s GDP? Show your work. 3) Consider a country with no international trade. The country’s economy has fixedprices and interest rates. Let C = 300 + 0.2Y , I = 250, and G = 0.5C. What is thiscountry’s GDP?
1. Assume that the economy is in a steady state and there is an unexpected permanent increase in the rate of depreciation δ. Using the appropriate diagram show: a. What is the best response to this change? b. Does consumption initially increase or decrease?

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