Multiplier and the tax multiplier different

Assignment Help Microeconomics
Reference no: EM131891757

Assume an economy is in recession with a MPC of 0.70 and there is a GDP gap of $300 billion. How much government spending must increase to eliminate the GDP gap? Instead of increasing government spending by the amount you calculate, what would be the tax cut required to achieve elimination of the GDP gap? Discuss how and why the spending multiplier and the tax multiplier are different?

Reference no: EM131891757

Questions Cloud

How your poem is connected to the theme you chose : Draw a conclusion about how your poem is connected to the theme you chose. Draw a conclusion about how this poem is connected to the theme.
How much money will analog need to borrow in order to end up : How much money will Analog need to borrow in order to end up with $830,000 spendable cash?
Discuss your response to the productions lights and sound : Discuss your response to the production's costumes, set, lights, sound, cast (actors), and the performance venue itself. What worked? Why? What didn't work?
Complete the needs assessment matrix : Observe and assess the state of your current organization, or another pre-selected organization. A needs assessment is necessary to identify areas.
Multiplier and the tax multiplier different : Instead of increasing government spending by the amount you calculate, what would be the tax cut required to achieve elimination of the GDP gap?
What is effective rate of interest on compensating balance : what is the effective rate of interest on a $835,000 loan where a 16% compensating balance is required?
How does managerial economics fit into your topic : What is the usefulness of understanding this topic in today's corporate structure?How does managerial economics fit into your topic?
Describe and discuss the speaker of the poem : describe and discuss the speaker of the poem. Try not to repeat information from your coverage of the situation, so that your writing focuses more on the person
How much soybeans must us-mexico give up : Please complete the following opportunity cost table. (Hint: In order to produce one unit of Soybeans how many Avocados must U.S.

Reviews

Write a Review

Microeconomics Questions & Answers

  Explain congress intent for enacting the amt

Explain Congress' intent for enacting the AMT. Identify each of the following as a tax preference item (PREF), an AMT adjustment item to calculate preadjustment AMTI (ADJ).

  The employee must work the midnight to

Other things being constant, how will the following influence the hourly earnings of employees? Explain your answer. a. The employee must work the midnight to 8: 00 A.M. shift.

  What are the mp of capital and labor

graph the q = 60 and q = 100 isoquants, in indicate the points found in part a and b. d) what are the MP of capital and labor? what are the MP of capital and labor?

  1you are the ceo of exxonmobil your head of research

1.you are the ceo of exxonmobil your head of research department informs you that his chemists have devised an additive

  Calculate alternative measures of industry structure

Write a short history about the company, major products, and location - determine the factors that will influence demand for their products.

  Change in demand and a change in the quantity demanded

Distinguish between a change in demand and a change in the quantity demanded (movement along the demand curve).

  Discuss changes in the market background factors of demand

Discuss specific changes in the market background factors of demand in the last five years (2011-2016) for this product. Discuss how the brand maker responded to these market changes in these background factors.

  Using the solow model consider the effect on the economy

Using the Solow model consider the effect on the economy of a reform that eases the immigration procedure leading to an increase in the rate of immigration. Discuss also using graph.

  How much should it borrow in period one

Assume that a country produces an output Q of 50 every year. The world interest rate is 10%. Consumption C is 50 every year, and I = G = 0.

  Ball field is being considered to be built in metropolitan

A major ball field is being considered to be built in a metropolitan by a High Tech company at a cost of $50M. The construction company recommends a major renovation every 50 years at a cost of $10M. If the corporation wants to set up a trust fund to..

  Identify the economic factor that has had the most impact

Consider an organization you are familiar with. Identify the economic factor that has had the most impact on the organization's earnings in the past 5 years.

  Define the cost-benefit analysis

Understanding Cost-Benefit Analysis How would you apply the concept of cost-benefit analysis to the decision whether to finish high school?

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