ECON: Macroeconomics Answer the following questions Complete the following table
ID: 1094267 • Letter: E
Question
ECON: Macroeconomics
Answer the following questions
Complete the following table assuming (a) MPS = 1/5, (b) there is no government and all saving is personal saving. Complete the accompanying table. Using the below graph show the consumption and saving schedules graphically. Locate the break event level of income. How is it possible for households to dissave at very low income levels? If the proportion of total income consumed decreases and the proportion saved increase as income rises, explain both verbally and graphically how the MPC and MPS can be constant at various levels of income. The data in the first two columns below are for a closed economy. Use this table answer the following questions. What is the equilibrium GDP for the closed economy? Including the international trade figures for exports and imports, calculate net exports and determine the equilibrium GDP for an open economy. What will happen to equilibrium GDP if exports were $5 billion larger at each level of GDP? What will happen to equilibrium GDP if exports remained at $10 billion, but imports dropped to $5 billion? What is the size of the multiplier in the economy?Explanation / Answer
qs 1
MPS = (1-MPC)
qs 2
income consumption (MPC*income ) savings (MPS*income) 250 260 -10 275 137.5 137.5 300 150 150 325 162.5 162.5 350 175 175 375 187.5 187.5 400 200 200Related Questions
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