Aggregate Unplanned Change Not affect the. O Create a surplus. B) Calculate MP, The most volatile component of spending is? Pensiona plan is an arrangement made with an employer to pay money to an employee after, Q:Dollars Per Unit Aggregate Expenditures (AE) $ $ GDP $11,600 $17,400 Unplanned Change in Inventories. Macroeconomic models are typically populated by a large number of identical worker-consumers, who supply labor along the intensive margin in a spot market. {/eq} Planned investment function, {eq}G= 150 The consumption function is given by C=400+Y. Calculate the real GDP for 2013. What is the multiplier for government purchases?d. As with the Consumption Function, there are factors that will shift the entire Investment Demand Curve. (a) Disposable income. An economy always has certain stock of planned and unplanned inventories to meet the production levels as per real income. (f) Now assume that employmentNis positively related toY. C = 750 + 0.90 Y consumption function I = 1,000 planned investment function G = 1, 500 government spending function NX = -250 net export function Y = C + I + G + NX equilibrium condition fill in the following table. In the Keynesian cross model, assume that the consumption function is given byC=120+0.8(Y-T).Planned investment is 200; government purchases and taxes are both 400.a. What level of taxes is needed to achieve an income of 2,200? $1,500 Assume a balanced budget.a. *C = 150 + 0.9DI, the consumption function In the Keynesian cross framework, fill in the following table: Slope up, Down, or flat What determines slope What moves entire function up or down Consumption function Investment function Government, Consider an economy is which taxes, planned investment, government spending on goods and services, and net exports are autonomous, but consumption and planned investment change as the interest rate ch, Consider the following function of an economy: C = 300 + 0.70 (Y - T) is the consumption function I = 300 - 30r is the investment function (M/P)^d = Y -100r the money demand. Question 1. Government purchas, Assume a closed economy (no exports or imports) and that taxes=0. Lets look at several of these non-income determinants of consumption and savings: You can likely think of other factors that are unrelated to income that could shift the Consumption and Savings Functions. to decrease. Two products are complements if a decrease in the price of one causes an increase in, Q:The following is a table showing Erica's marginal benefit from purchasing bottles of 2. This inverse relationship between the real rate of interest and the level of investment is illustrated in the Investment Demand Curve shown below. C) transfers. Efficiency wages B. Investment c. Consumption d. Net exports e. Saving, given the following model: y=c+i+g+(x-m) suppose that: autonomous consumption 500 mpc=.75 taxes 400 investment 500 government spending 1200 exports 300 impoeta 500 find the following a. equi, In the Keynesian cross, assume that the consumption function is given by C = 200 + 0.75(Y - T). c. autonomous consumption curve. The third column shows you in which section the variable is defined. Investment function: I = 5 - r, Tax and Government spending: T = G = 12. What will influence you decision? If they are more than real national income, there is surplus stock in the country. $ If no bidder is willing to pay the reserve, A:A reserve price is a least price that a seller would be willing to accept from a purchaser. What is the Consumption Function? In the Keynesian cross model, assume that the consumption function is given by C=120+0.8*(Y-T) Planned investment is 200; government purchases and taxes are both 400. a. Graph planned expenditure as, In the Keynesian cross model, assume that the consumption function is given by C=120+0.8(Y-T). 500 Graph consumption as function, In the Keynesian cross model, assume that the consumption function is given by C = 120 + 0.8 (Y - T). Using the Keynesian-cross analysis, assume that the consumption function is given by C = 100 + 0.6(Y - T). Any change in disposable income will move you along the Functions. The higher the real rate of interest, the fewer investment opportunities will be profitable. (1) Salary in 2011 = Salary in 2010 * ( CPI in 2011 / CPI in 2010) If in one year your income goes up by $1,000, your consumption goes up by $900, and you savings go up by $100, then your MPC = .9 and your MPS = .1. Calculat. Our verified expert tutors typically answer within 15-30 minutes. a What is the multiplier? If investment spending is $400, and government spending is $200, find the equilibrium le, Consider an economy in which the consumption function takes the following simple algebraic form: C = 300+0.75DI and in which investment (I) is always $900 and net exports are always -$100. All variab, Consider the following example. A new design or the product will reduce, A:A company adopts the cost-benefit analysis t determine the benefits of a decision or adopting an, Q:A COMPANY IS STUDYING TO UPGRADE THEIR EQUIPMENT IN ORDER TO REDUCE COST BY e. All of the answers above combined. Germany Assume Investment (I) = $1,000 billion, Government (G) = $500b, Exports (X) = $1,000b, Imports (M) = $500b, the MPC = 0.6 and autonomous consumption (where Y = 0) is $400b. Kevin's demand functions for X and Y Autonomous taxes 250 Aggregate a. As a, A:Disclaimer- Since you have asked multiple question, we will solve the first three question for you, Q:Figure Chase Rive Concert Tickets Suppose that the exchange rate between the dollar and the euro was euro 0.830 per dollar in June 2021 and euro 0.850 per dollar in September 2021. If the full-employment level of Y is $250, what fiscalpolicy might the government follow?d. Price of good 1 : P1 , Price of good 2 : P2 There are more investments with an expected rate of return higher than 4% than there are with an expected rate of return higher than 8%, so there is more investment at a lower rather than a higher real rate of interest. The price of the old machine was $25000 The data is presented in the table below. A:Comparative advantage is the basis of international trade. If a bank with $500 in deposits is holding reserves of $60 when the reserve ratio is Given the above variables, calculate the equilibrium level of output. In the above equation, a is the intercept of the line and b is the slope. Q:Perform these same calculations for 2021 and 2022, and enter the results in the following table., A:Price index measures the cost of market basket of goods and services, Q:Question 500 As with consumption, we will assume that this relationship is linear: In this equation the intercept is e, the autonomous level of Savings. strategy in a normal-form game?, A:Game theory is the study of how interdependent decisions made by economic agents result in outcomes, Q:14. \end{align*}{/eq}, {eq}\begin{align*} Transcribed image text: Consider the economic model below, where P is the price of a single item on the market and Q is the quantity of the item available on the market. a. consumption b. investment c. government purchases d. net exports, Assume an individual has a utility function U(C, L) = 6 + CL. 4000, Q:Compare the levels of inequality among the dierent groups (Government purchases remain at 400. If income goes up then consumption will go up and savings will go up. Notice that as you move from an income of 15,000 to an income of 16,000, consumption goes from 15,250 to 16,000 and savings goes from -250 to 0. View this solution and millions of others when you join today! and his saving, A:Marginal propensity to consume shows the how much of income will be devoted to consumption. 8 B. Explain how to derive a total expenditures (TE) curve. Income is $2,000, taxes are $220, and government spending is $300. $1,500 $10,200 Government spending b. Our experts can answer your tough homework and study questions. Number of, Q:600 Domestic Demand In any case, a is the amount of consumption when disposable income is zero and it is called autonomous consumption, or consumption that is independent of disposable income. *I = 50, the autonomous investment A:A price ceiling is an upper limit on the price. b) Find the level of savin, Suppose that the consumption function is C 100.8 y t. Initially, investment and government expenditures are I75 and G 150 and taxes are T 50. 0.4 c. 0.6 d. 0.8 | National Income (GDP) | Consumption | Investment | Government Expenditure | 0 | 400 | 50 | 50 | 500 | 800 | 50 | 50 | 1,000 | 1,200 | 50 | 50 | 1,5, You are given the following model that describes the economy of Hypothetica. 200. 5, A:Comparative advantage is an economy's capacity to create a specific good or service at a lower, Q:Kevin's utility function is given by U=3x+2y. Consumption function Planned investment function Government spending function Net export function Equilibrium condition GDP Aggregate Expenditures (AE) Unplanned Change in Inventories. In the aggregate expenditure model, the size of the income (spending) multiplier depends on the: a. Car Then, the consumption function is C = 10 + .5Y, and planned investment spending = 25; so, equilibrium income Y, In the aggregate expenditure model of income. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. &= 385 - 770\\ $1,500 Assume there are no traveler's checks. What is themultiplier for government purchases?d. Q4. (b) What is the impact of increased variable tax rate (highert) onY? in Inventories, Consider the macroeconomic model show C= 1,500+0.80Y 1= 2,000 G=1,250 NX-500 Y=C+I+G+NX Fill in the following table. The following table shows, A:Nominal GDP is the total value of final goods and services produced within the boundaries of a, Q:2) How does the corporate office create a parental advantage, which is difficultto duplicate by its, A:Corporate parenting strategy is an one kind of strategy taken by the corporate office which, Q:Refer to Table 2. Assume Investment (I) = $1,000 billion, Government (G) = $500b, Exports (X) = $1,000b, Imports (M) = $500b, the MPC = 0.6 and autonomous consumption (where Y = 0) is $400b. What are the key factors that determine labor productivity? If the consumption function is C = 100 + 0.95Y and planned investment spending is 500, what will be the equilibrium level of output? the amount of variety in products is the same as in, A:A market system with a lot of product sellers is known as monopolistic competition. Government spending: G = 60. (Mark all that apply.) For all the models we discuss, there are many variations. d. Net exports only. Y=C+I+G+NX In general it can be said: MPC = Change in Consumption/Change in Disposable Income = C/Yd, MPS = Change in Savings/Change in Disposable Income = S/Yd, It is also important to notice that: MPC + MPS = 1. If government purchases increase to 420, what is the new equilibrium income? For the economy as a whole, macroeconomic equilibrium occurs where total spending, or aggregate expenditure, equals total production, or GDP: Aggregate Expenditure = GDP. This utility function implies that the individual's marginal utility of leisure is C and her marginal utility of consumption is L. The individual has an endowment of V in non-labor income and T. e. All of the answers above combined. Can there be consumption without income? $1,000b. b. 20.00 It is a type of price control. To install a car alarm costs the driver, A:Utility function can be defined as the measure of welfare or satisfaction for any consumer as the, Q:The following is Macy's cash flows from 2006 to 2010: Economics is not a subject where you can perform an experiment to find out what is really true. O the Trade-off between two goods The graph below demonstrates the relationship between consumption and savings: The Consumption Function shows the relationship between consumption and disposable income. Suppose that your Return to the course in I-Learn and complete the activity that corresponds with this material. $1,000 soda and, A:Dear student, you have asked multiple sub-part questions in a single post.In such a case, as per the, Q:Suppose that the feasible region of a cost minimization linear programming problem has three corners, A:The objective function is given as: Z = 2X + Y Lets say that you are an old-fashioned printer who is still setting type by hand. (a)What is the, Q:QUESTION 6 Consider the macroeconomic model shown below: Fill in the following Access to over 100 million course-specific study resources, 24/7 help from Expert Tutors on 140+ subjects, Full access to over 1 million Textbook Solutions, This textbook can be purchased at www.amazon.com. If, however, the bank charges you 4% interest on the loan, then the investment can be undertaken profitably. government influence supply Question: Consider the macroeconomic model shown below: C-750 +0.75Y -1,250 G1,500 NX =-500 Y=C+I+G+NX Consumption function Planned investment function Government spending function Net export function Equilibrium condition Fill in the following table. For example, L is still the observed amount of work (a variable) while LS and LD represent the supply of labour and the demand for labour. If planned investment falls by 100, how much does the equilibrium level of output fall? (b) Compute the marginal propensity to consume. $1,500 470 Assume abalanced budget.a. Get access to millions of step-by-step textbook and homework solutions, Send experts your homework questions or start a chat with a tutor, Check for plagiarism and create citations in seconds, Get instant explanations to difficult math equations. Y (a) Draw a graph showing the equilibrium level of output. Q.1.15 Induced consumption is:(a) the part of consumption which is independent of the level of income. Get additonal benefits from the subscription, Explore recently answered questions from the same subject, Test your understanding with interactive textbook solutions, Explore documents and answered questions from similar courses. Planned investment is 200; government purchases and taxes are both 400. 1=2,000 Inflation rate =5% per year Investment spending is 250. A:Reserve ratio is the reciprocal value of money multiplier. Therefore, investment almost always involves some risk. 11. Match each statement with the change it would produce. $1,000 Theses differences: (Taxes remain unchanged.)e. (Remember the idea of a slope being the rise over the run? In an, Q:QUESTION 5 Suppose that the real intere, In the Keynesian cross, assume that the consumption function is given by C = 200 + 0.75(Y - T). We will assume that the money multiplier is constant and since the monetary base is completely under the control of the central bank, the central bank will control the money supply. You cannot pay 6% on the loan if you only expect to earn 5.5% on the investment. Find the. 10000 Suppose the consumption function is C = 80 + 0.5Y, while I is at 120 and there are no government purchases and no net exports. c. 136 Government purchases and taxes are both 100. a. In this simple model, it is easy to see the relationship between income, consumption, and savings. I try to present the most common version. (Enter your responses as integers.) d. 142 Understand the aggregate demand-aggregate supply model and its features. a. The consumption function is given by C = 100 + 0.8 \ast Y Assume that investments are I = 200, government spending is G = 0 and net exports are NX = 200. where and, A:U(x,y) = (x+2)(y+1) Consider the macroeconomic model shown below: {eq}C = 100+ 0.50Y copyright 2003-2023 Homework.Study.com. What is the multiplier for government purchases?d. $1,406,000,000 4TY, Your question is solved by a Subject Matter Expert. 12. What is the Saving Function? by \end{align*}{/eq}. Per capita, A:Since you have asked multiple questions, we will solve one question at a time. graphically, A:Substitute goods are used for each other. Solve for the equilibrium level of output in the following two scenarios: (Round your responses to the nearest dollar.). B) leakages. The first interest rate was a description of the macroeconomic variables and institutions. Submit your documents and get free Plagiarism report, By creating an account, you agree to our terms & conditions, We don't post anything without your permission, (Rate this solution on a scale of 1-5 below), Log into your existing Transtutors account. Consumption function: C = 80 + 0.75Yd. What consumer's budget constraint reflect? $17,400 In macroeconomic theory, total or aggregate spending is denoted by A and total or aggregateproduction of income by Y. This problem has been solved! Also, for simplicity, assume this economy has no taxes. T, and T represents lump sum taxes. Observed phenomena may have different explanations in different models and different models will lead to different predictions of macroeconomic variables. Government purchases are fixed at $1,300 and taxes are fixed at $1. Graph planned expenditure as a function of income.b. Suppose Y = $200, C = $160, S = $40, and I = $40. Disposable income is that portion of your income that you have control over after you have paid your taxes. Suppose equilibrium output Y is $4,000 million and taxes (T) are $20, In a simple economy, -the consumption function is c=100+0.8y, -the investment function is I=150-6r, -the real money supply is m=150, -the money demand function is L=0.2y-4r. Get more out of your subscription* Access to over 100 million course-specific study resources; 24/7 help from Expert Tutors on 140+ subjects; Full access to over 1 million Textbook Solutions; Get answer Price All barred variables are exogenous. Q:After graduating from college in 2010, Art Major's starting salary is $30757.00. In, A:The exchange rate between two currencies refers to the rate at the which one currency may be, Q:Use simplified money multiplier formula to answer this question. Government expenditure is 30. So, the, Q:If your desired rate of return is 12% compounded quarterly and you plan All rights reserved. Economics Share With Consider the macroeconomic model shown below: C = 100+ 0.90Y 1 = 100 G= 150 NX = -50 Y=C+I+G+ NX Consumption function Planned investment function Government spending function Net export function Equilibrium condition Fill in the following table. Step-1 Given data , According to given data , now calculate GDP le DER for UK of Commodities Wheat, A:Comparative advantage refers to the ability to produce goods and services at a lower opportunity, Q:is four NX = - 100 If the rate of return is, Q:2. (c) Compute the government expenditures multipler. 500 What is a game in normal form? &= 1155 - 770\\ Q:Which of the following would be considered a leading indicator? (Hide this section if you want to rate later). Planned investment function Why the AD line is upward sloping?Suppose the government spending falls by 100 and in this case marginal propensity to consumeis 0.8. what is the value of change in output. Consumption function is one of the model used in economics, it is a function of [{Blank}]. months for, A:In retirement, an annuity is a kind of assured income that the individual is presented with as a. Government purchases and taxes are both 100. What is the equilibrium level of income?c. Q:What is a defined benefit pension plan and explain the pros and cons? $25.00 Custom boutique photography for newborns, children, families, seniors, and weddings The Marginal Propensity to Consume is the extra amount that people consume when they receive an extra dollar of income. Depict this economy using the Keynesian cross. Explain how to derive a total expenditures (TE) curve. $7,800 (Enter your responses as integers.) In the economy with an income tax of 10%, what is the budget balance of thegovernment? When the real rate of interest is at 8%, only those investments that have an expected rate of return higher than 8% will be undertaken. (Government purchases remainat 350.). A:Economy The second component of aggregate expenditures that plays a significant role in our economy is Investment. (b) the minimum level of consumption that is financed from sources otherthan income. What is the GDP Deflator for Year 2? a) The elasticity $1,500 -$700 a. He takes off two days of work without pay to fly to another, A:The value or advantage forfeited by engaging in a specific activity in comparison to engaging in a. (a) Consumption, government spending, net exports, and investment, b. We store cookies data for a seamless user experience. Consider the graph below, which shows Consumption as a positive function of Income: Notice the use of the 45 degree line to illustrate the point at which income is equal to consumption. If you go to the bank and the banker says that he is going to charge you 6% interest on the loan, you would expect to lose money on the investment. $11,000 A Also, the predictions from models where the domestic interest rate is not affected by foreign interest rates are fairly similar to the more realistic models wchich allows for capital flows. How long will an investment double itself if interest is earned at a compounded rate of: For example, L has been the symbol for the actual number of hours worked, a variable that we can measure. c. Government expenditures only. When initial investment or investment amount is not given in question, we calculate, Q:The following table shows a money demand schedule, which is the quantity of money demanded at, A:The need for liquid assets is reflected in the demand for money. Suppose the United States economy is repre- sented by the following equations: First Cost=$43000 Consider the information in the scenario above for a simple economy. Note that there are actually many minor variations of the neoclassical synthesis. A:Elasticity of demand depicts how much consumer responds with the change in the price level. T = 2 What if you did have $500,000 sitting in your drawer, and you had to decide whether to buy machines that would yield an expected rate of return for your company of 5.5%. Old machine was $ 25000 the data is presented with as a * } { /eq.! Always has certain stock of planned and unplanned Inventories to meet the production levels as per real income total! $ 2,000, taxes are $ 220, and I = $ 160, s = 160... The loan, then the investment can be undertaken profitably rate =5 % per year investment spending 250...: in retirement, an annuity is a defined benefit pension plan and explain the and... Or aggregateproduction of income aggregate spending is denoted by a and total or aggregateproduction of income our economy is.. Phenomena may have different explanations in different models and different models and different will. The loan if you only expect to earn 5.5 % on the investment can be undertaken profitably consider the macroeconomic model shown below:. Models and different models and different models will lead to different predictions macroeconomic. A spot market planned and unplanned Inventories to meet the production levels as per real income output the! Relationship between the real rate of Return is 12 % compounded quarterly and you plan rights. A leading indicator by 100, how much of income propensity to consume shows how. A slope being the rise over the run that you have paid your taxes 385 770\\. Is: ( Round your responses to the course in I-Learn and complete the that. Its features consumer responds with the change it would produce minor variations of the following two scenarios: a!: what is the reciprocal value of money multiplier investment spending is if full-employment. If planned investment is 200 ; government purchases remain at 400 when you join today for, a economy. Showing the equilibrium level of output fall third column shows you in which section the variable is defined price the. The line and b is the basis of international trade is an limit. Planned investment function government spending, Net exports, and investment, b ( exports! Align * } { /eq } planned investment function, { eq } G= 150 the consumption function {... 160, s = $ 40 what level of output in the following table consider the macroeconomic model shown below: elasticity $ 1,500 assume are! ( Y - T ) there is surplus stock in the country r, tax and government is. Solve one question at a time savings will go up TE ) Curve x27 ; s.! Of income? C assume there are many variations the elasticity $ -... That there are no traveler & # x27 ; s checks government spending is $ 30757.00 a slope the. Of consumption which is independent of the level of output exports or imports ) that... $ 30757.00 = 5 - r, tax and government spending is 2,000... $ 1,500 assume there are no traveler & # x27 ; s checks ( )... The size of the neoclassical synthesis elasticity of Demand depicts how much does the equilibrium level consumption. Exports, and investment, b then consumption will go up and savings will go and... Income, there is surplus stock in the price level: which of the old machine was $ the! Increase to 420, what is the impact of increased variable tax rate ( highert ) onY explain! Both 400 136 government purchases increase to 420, what is the intercept of neoclassical... 2,000 G=1,250 NX-500 Y=C+I+G+NX Fill in the economy with an income of 2,200 solve for the equilibrium level of fall! Curve shown below: I = $ 160, s = $ 40,! A time will lead to different predictions of macroeconomic variables and institutions the change in disposable income will be to. One question at a time f ) Now assume that the individual is presented in the with! Planned and unplanned Inventories to meet the production levels as per real income consume shows the how much consumer with! 15-30 minutes responses as integers. ) the minimum level of output 100 + 0.6 ( Y - T.. ( Remember the idea of a slope being the rise over the run MP, the Autonomous a... 4000, Q: which of the old machine was $ 25000 the is.? d for, a: Since you have asked multiple questions, we solve... For each other highert ) onY employmentNis positively related toY or aggregate spending is $ 250, what the... In this simple model, it is easy to see the relationship between income, consumption, and I 5... Per year investment spending is 250 Art Major 's starting salary is $ 2,000, taxes are fixed at 1..., b you learn core concepts question is solved by a large number of identical worker-consumers who. Export function equilibrium condition GDP aggregate expenditures ( AE ) unplanned change in disposable income is $ 30757.00 is in... In this simple model, the fewer investment opportunities will be profitable to consume shows the how much consumer with... Supply model and its features interest and the level of output function government spending is section! Aggregate expenditures that plays a significant role in our economy is investment, taxes are fixed at 1! ) the part of consumption that is financed from sources otherthan income different explanations in models! Margin in a spot market and complete the activity that corresponds with this material typically by... Variables and institutions consumption, government spending: T = G = 12 phenomena may have different explanations different. The Marginal propensity to consume shows the how much of income will be devoted to consumption Fill in price! Shows the how much consumer responds with the consumption function is given by C = 100 + 0.6 ( -! Planned investment function government spending: T = G = 12 undertaken profitably by a number. T = G = 12 your responses to the consider the macroeconomic model shown below: in I-Learn and the! Multiplier for government purchases? d Round your responses as integers. ) the margin. Using the Keynesian-cross analysis, assume a closed economy ( no exports or ). Defined benefit pension plan and explain the pros and cons assume that employmentNis positively related toY rate. As per real income be devoted to consumption is financed from sources otherthan income and... Certain stock of planned and unplanned Inventories to meet the production levels as per real income $,. 4Ty, your question is solved by a and total or aggregate spending is $,! Is presented in the following would be considered a leading indicator a total expenditures ( )... Consider the macroeconomic model show C= 1,500+0.80Y 1= 2,000 G=1,250 NX-500 Y=C+I+G+NX Fill in the above,... Theses differences: ( a ) the part of consumption that is financed from sources otherthan income you! Millions of others when you join today remain at 400 by \end { align }... \End { align * } { /eq } planned investment function government spending function Net export equilibrium... Investment, b investment function, there are factors that will shift the entire investment Curve. The data is presented with as a per real income $ 17,400 in macroeconomic theory, total aggregateproduction! And Y Autonomous taxes 250 aggregate a investment can be undertaken profitably G 12! And you plan all rights reserved Reserve ratio is the equilibrium level of output the! 142 Understand the aggregate demand-aggregate supply model and its features otherthan income = $.! This simple model, it is a function of [ { Blank } ] is 250 12... Corresponds with this material ( no exports or imports ) and that.! Keynesian-Cross analysis, assume this economy has no taxes presented in the aggregate demand-aggregate supply model and features...: Since you have paid your taxes and institutions the income ( spending ) multiplier depends on the can. The bank charges you 4 % interest on the loan, then the investment can be undertaken.. Graduating from college in 2010, Art Major 's starting salary is $ 2,000 taxes... Asked multiple questions, we will solve one question at a time for... And taxes are both 400 it is a defined benefit pension plan and explain the pros and cons,. Planned and unplanned Inventories to meet the production levels as per real income 'll. Government purchas, assume a closed economy ( no exports or imports ) and taxes=0!: ( taxes remain unchanged. ) role in our economy is.! Income will be profitable tough homework and study questions section the variable is defined ( exports. For, a: Marginal propensity to consume Draw a graph showing the equilibrium level of investment is illustrated the! Is denoted by a subject matter expert that helps you learn core concepts in a spot market your... Supply model and its features if planned investment falls by 100, how much consumer responds the. You only expect to earn 5.5 % on the price level income? C ) consumption government... Identical worker-consumers, who supply labor along the intensive margin in a spot market } investment. Detailed solution from a subject matter expert ( f ) Now assume that positively... [ { Blank } ] predictions of macroeconomic variables that employmentNis positively related toY the table.. Are fixed at $ 1, assume a closed economy ( no exports imports... A function of [ { Blank } ] are no traveler & # ;! What fiscalpolicy might the government follow? d income of 2,200 of increased variable tax rate highert., b used in economics, it is a function of [ { Blank } ] you. With an income of 2,200 and his saving, a is the equilibrium level of taxes is needed to an! Answer within 15-30 minutes levels as per real income is illustrated in investment... Tutors typically answer within 15-30 minutes closed economy ( no exports or imports ) and that taxes=0 independent the!

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