Supposed that the amount of saving that occurs at each

Assignment Help Accounting Basics

Reference no: EM13600912

Linear equations for the consumption and saving schedules take the general from C = a + bY and S = - a + (1-b)Y, where C,S, and Y are consumption, saving, and national income, respectively. The constant a represents the vertical intercept, and b represents the slope of the consumption schedule.

a. Use the following data to substitute numerical values for a and b in the consumption and saving equations.
National Income (Y) Consumption (C)
$0 $80
100 140
200 200
300 260
400 320

b. What is the economic meaning of b? Of (1-b)?
c. Supposed that the amount of saving that occurs at each level of national income falls by $20 but that the values of b and (1-b) remain unchanged. Restate the saving and consumption equations inserting the new numerical values, and cite a factor that might have caused the change.

Reference no: EM13600912

Questions Cloud

Julio purchased a stock one year ago for 27 the stock is : julio purchased a stock one year ago for 27. the stock is now worth 32 and the total return to julio for owning the

Warranty4u provides extended service contracts on : warranty4u provides extended service contracts on electronic equipment sold through major retailers. the standard

Babs purchased a piece of real estate last year for 85000 : babs purchased a piece of real estate last year for 85000. the real estate is now worth 102000. if babs needs to have

Physicians practicing in eastern universitys hospital have : physicians practicing in eastern universitys hospital have the following compensation agreement. each doctor bill the

Supposed that the amount of saving that occurs at each : linear equations for the consumption and saving schedules take the general from c a by and s - a 1-by where cs and

On january 1 2007 the horton corporation issued 10 bonds : on january 1 2007 the horton corporation issued 10 bonds with a face value of 200000. the bonds are sold for 196000.

Hbr delicatessen sells specialty sandwiches currently their : hbr delicatessen sells specialty sandwiches. currently their equipment can produce 60 sandwiches per hour with a fixed

Using the weighted average method prepare a process cost : seebohm fabrication ltd manufactures frames for bicycles. each frame passes through three processes cutting welding and

What are abercrombie amp fitchs significant accounting : access the 2007 10-k for abercrombie amp fitch www.abercrombie.com a compute the following ratios for abercrombie amp

User Account

All Pages