What is the equilibrium level of national product

Assignment Help Business Economics

Reference no: EM13734378

The model is:

TE = C + I + G

C = a + b (Y - t Y + TR)

Where

a = 60 G = 250

b = .8 TR = 200

t = .25 I = 200

a) What is the equilibrium level of national product?

b) What is the government's budget surplus?

c) The government decides to increase the tax rate to balance the budget. Let the change in the tax rate be +.04 (i.e., ?t = +.04). Calculate the Y from this tax rate change. What is the new equilibrium level of Y? What is the budget surplus? Graphically depict the effect of this tax rate change on Total Expenditures.

Reference no: EM13734378

Questions Cloud

Find the market-clearing price : Where aH and bH are her consumption of ale and bread. George and Harriet are each endowed with 4 units of ale and 4 uits of bread. Find the market-clearing price (which is a messy fraction).

Focused on resolving an employee problem : In this Assignment focused on resolving an employee problem, you will engage in developing the following professional competencies: Active listening, Defining an unstructured problem

Unemployment components of the natural rate : If workers do not have the skills that are required in the job market, which of the following will occur? When the economy is below full employment, it is producing. How has the unemployment components of the natural rate of unemployment changed over..

Why might corporation have to file for bankruptcy protection : Why might the corporation have to file for bankruptcy protection? What provision(s) of the securities law will probably be the basis for a class-action lawsuit by the stockholders?

What is the equilibrium level of national product : What is the equilibrium level of national product? What is the government's budget surplus?

Find the competitive equilibrium : Bob's utility function is UB = (hB - 1)2sB where hB and sB are his consumption of hamburgers and salads respectively. Let p be the price of hamburgers measured in salads. Alice is endowed with one salad and two hamburgers. Bob is endowed with six sal..

Research on performance appraisal feedback : Your supervisor, Annalise, the Human Resources Director at Matrix, has reviewed your research on performance appraisal feedback and is very impressed with your work.

What is the highest grade : You have four equally weighted tests in a course and your test average in the class has fallen from 90 to 88 to 84 to 81 where is it now. What score did you grt on each exam? You have a final left that is weighted the same as the other tests. What is..

Prove that every weighted average of three numbers : Prove that every weighted average of three numbers x1

User Account

All Pages