By how much will consumption decline

Assignment Help Econometrics
Reference no: EM131142132

Suppose households save 5 percent of their disposable income. If the government increases expenditures and taxes by $100 billion, by how much will saving decline? By how much will consumption decline? What happens to investment? (Assume a closed economy.)

Reference no: EM131142132

Questions Cloud

How much did prices rise during the civil war : Wartimes are usually associated with inflation. According to the Inflation Calculator at www.bls.gov/cpi/home.htm, what would $100 in 1860 be worth in 1865? By how much did prices rise during the Civil War?
Describe situation with the drugs crossing border into us : Describe the situation with the drugs crossing the border into the United States. Is it possible to adequately address this issue and not affect the US / Mexican economic status?
Are there protective measures in place to ensure its safety : Provide any information that you feel is unique to each sector. In your local community, research the infrastructure, and identify one particular element that may be of particular interest to a terrorist or vulnerable to natural or manmade disaste..
What is translation adjustment determined solely for 2015 : If this is a translation. what is the translation adjustment determined solely for 2015? - If this is a remeasurement. what is the remeasurement gain or loss determined solely for 2015?
By how much will consumption decline : Suppose households save 5 percent of their disposable income. If the government increases expenditures and taxes by $100 billion, by how much will saving decline? By how much will consumption decline? What happens to investment? (Assume a closed e..
Compute the per-unit resistance of the load : Determine the load resistance in ohms referred to the high-voltage side and the per-unit value on the chosen base.
Why are they important components of theoretical schemes : What are the key differences between the 4 identified types of research theories listed in the assignment instructions? Is anyone type of theory more valid than the others? Why or why not?
Discuss the effect on employment and output : discuss the effect on employment, output, the real rate of interest, investment, and saving if households become more optimistic about the future and as a result reduce their current saving.
Compute the per-unit reactance of the transformer : Compute the per-unit reactance of the transformer - what value of the per-unit reactance should be used to represent this transformer?

Reviews

Write a Review

Econometrics Questions & Answers

  How much in total consumer nd producer surplus would be lost

Show how the allocation of the loss of total consumer and producer surplus between suppliers and demanders described in part b depends on the price at which broccoli is sold. How woiuld the loss be shared if P = 140

  Calculate the equilibrium level of income in the economy

Household spending is given by the following equation: C = $100 + 0.70Yd and Intended Investment = $125. (a) Calculate the equilibrium level of income in the economy, and explain why this is the case.

  How much a depository institution holds vault cash

A depository institution holds vault cash of $1 million, reserve deposits at the Fed of $49 million. If that institution holds $500 million in transactions deposits and is subject to a 3 percent reserve requirement on the first $50 million of thos..

  Recalculate equilibrium level of gdp using tax multiplier

Suppose further that investment spending is fixed at 100. Calculate the equilibrium level of GDP. Solve for equilibrium levels of Y, C, and S Next assume taxes were reduced by 20 to a level of 180.

  What would you expect to earn after your raise

Suppose you are currently earning $15 an hour. If the inflation rate over the current year is 10 percent and your firm provides a cost-of-living raise based on the rate of inflation, what would you expect to earn after your raise? If the cost-of..

  Determine the pauls production possibility frontier

Paul can make either "100 bottles of wine and 0 boxes of chocolates" or "0 bottles of wine and 1600 boxes of chocolates" or a combination of wine and chocolates. For parts of this question assume that Paul's PPF reflects the property of constant o..

  Why an increase in lump sum transfer will reduce amount

Consider an increase in the lump sum transfer T. Use theconcepts of income and substitution effects to explain why an increase in the lump sum transfer will reduce the amount of labor supplied.

  Why is there a lack of price competition between

In your answer evaluate both the collusive and non collusive scenario. What are the alternatives available to banks to maintain or increase their market share?

  Calculate its excess reserves of banks

Suppose that the reserve requirement is 3% on the first 30 million of checkable deposits and 10% on the checkable deposits in excess of 30 million. (Amounts on the balance sheet are in millions of $) Assets- Reserves 15.9, Loans 150.0, Securities 3..

  What uniform annual investment will have to make on birthday

rate lifesaver for steps A man wants to help provide a college education for his young daughter. He can afford to invest $600/yr for the next 4 years, beginning on the girl's 4th birthday.

  What is the value of equilibrium real gdp

Assume autonomous real investment is $30, autonomous real government spending is $30, and autonomous real net exports is -$20. Compute Aggregate Expenditures at each level of real GDP. What is the value of equilibrium real GDP

  Describe what would happen to break-even point

a. If these products are sold in the ratio of 4A for 3B, what is the break-even point b. If the product mix has changed to 5A for 5B, what would happen to break-even point c. In order to maximize the profit, which product mix should be pushed

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd