Calculate the total-spending function

Assignment Help Microeconomics
Reference no: EM132113299

Question: Given the information in the table calculate the following:Assume Y = N$500m + 0,85Y; M= 0,3Y; I = N$900m; G = N$850m; X = N$1,840m and t = 0,21Y.

1 Calculate the total-spending function and equilibrium income. Illustrate this on a graph.

2 Indicate on the graph the effect of an N$300 million increase in investment spending and comment on the magnitude of change in the equilibrium income relative to the change in investment spending. Calculate the new equilibrium income.

3 Assume the marginal tax changes to t = 0,35Y. How will this change influence the total spending curve? Illustrate this on your graph.

Reference no: EM132113299

Questions Cloud

What is the flexible-budget amount : Sport-in Corporation manufactured 10,000 golf bags during April. Production 20,000 units 20,500 units. What is the flexible-budget amount
What tools are the most important to you to install : Name two or three advantages of using Nano Server with your Windows 2016 Server. What tools are the most important to you to install and manage it?
Calculate and interpret the coefficient of determination : HA1011 Applied Quantitative Methods - What is the probability that a random sample of 49 different one-hour shopping periods will yield a sample mean
Calculate the total variable cost at the activity level : Hettinger Hospital bases its budgets on patient-visits. The total variable cost at the activity level of 9,000 patient-visits per month should be
Calculate the total-spending function : Given the information in the table calculate the following:Assume Y = N$500m + 0,85Y; M= 0,3Y; I = N$900m; G = N$850m; X = N$1,840m and t = 0,21Y.
What is the net present value for the investment : Salvage value of equipment $2,000 Recovery of working capital 4,000 Discount rate 10%. What is the net present value for the investment
Why a ceiling on rents would reduce the total surplus : Suppose the supply of rental apartments is completely inelastic in the short run. Show that imposing a ceiling on rents that is below the equilibrium rent.
Why would your enthusiasm for rent control wane over time : If you do not know whether you would be able to get a rent-controlled apartment, under what circumstances might you nonetheless vote for rent control?
Unbounded optimization problem : Is it possible for an unbounded optimization problem to have a bounded feasible region?

Reviews

Write a Review

Microeconomics Questions & Answers

  Suppose the minimum average variable cost of producing

Suppose the minimum average variable cost of producing a good falls due to technological improvements. Show in a diagram how this affects the supply curve of a typical competitive firm and the supply curve of all firms in the industry

  What are the ex-post real interest rates

Assume that the inflation rates in 2010, 2011, and 2012 were 1%, 2%, and 3% respectively. During the same periods, nominal interest rates were 5%, 5%, and 6%, respectively. What are the ex-post real interest rates in 2010, 2011, and 2012?

  1 if the income elasticity of demand for lard is -300 that

1. if the income elasticity of demand for lard is -3.00 that means thata.lard is a substitute for butterb.lard is a

  The crankcase oil problem

My behavioral economics professor continues to refer to the "Crankcase oil problem" as a basis for assuming "something about preferences." What could he be referring to?

  Draw graph showing budget constraint and indifference curve

They both buy some milk and some doughnuts, but they buy considerably different quantities of the two goods. Can we conclude that their marginal rate of substitution between milk and doughnuts is the same? Draw a graph showing their budget constra..

  What would marginal and total costs be

Let's make part d more concrete: What would the total cost be if BigCo were the only firm in the market, and it had to produce 7 tons of rolled steel?

  Information about marginal revenue

Consider the following demand schedule. Does it apply to the perfectly competitive firm? Calculate marginal and average revenue.

  What does business inventory tell you about state of economy

The problem is relates to Economics and it is explain about a scenario where business inventories have increased dramatically in the last month and its effect on the economy.

  Define the types of ethical duties

Define the types of ethical duties Jeff, Joan, Martha, and Henry have to each other as owners of the company. What about as family members?

  Describe the context of the issue that was presented to you

Identification of the Issue: Describe the context of the issue that was presented to you and the specific statements that you will research.

  Which of the given is not among the functions of contract

Which of the following is not among the functions of contract? When manufacturers and distributors establish credible commitments to one another, they often employ?

  How does increasing the interest rate change

The Financial Advisor is a weekly column in the local newspaper. Assume you must answer the following question. "I recently retired at age 65.

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