What is the new equilibrium level of y

Reference no: EM13206890

aggregate output/income
2000
2500
3000
3500
4000
4500
5000
5500

consumption
2100
2500
2900
3300
3700
4100
4500
4900

planned investment
300
300
300
300
300
300
300
300

a. At each level of output, calculate saving. At each level of output, calculate unplanned investment (inventory change). What is likely to happen to aggregate output if the economy produces at each of the levels indicated? What is the equilibrium level of output?

b. Over each range of income (2,000 to 2,500, 2,500 to 3,000, and so on), calculate the marginal propensity to consume. Calculate the marginal propensity to save. What is the multiplier?

c. By assuming there is no change in the level of the MPC and MPS and planned investment jumps by 200 and is sustained at that higher level, recomputed the table. What is the new equilibrium level of Y? Is this consistent with what you compute using the multiplier?

Reference no: EM13206890

Questions Cloud

What structure does this system have : Suppose that X and Y are two mathematical objects of the same sort (two sets, two rings, etc.), and we consider the family of all homomorphisms among them. What structure does this system have?

Foreign country or community : Discuss major differences you've noticed in values and assumptions while in a foreign country or community that is culturally different from where you grew up.

Why is the effect on equilibrium output finite : Explain the multiplier intuitively. Why is that an increase in planned investment of $100 raises equilibrium output by more than $100 Why is the effect on equilibrium output finite How do we know that the multiplier is 1/MPS

Explain the generalized van der waals chemical potential : The generalized van der Waals chemical potential of a pure solvent and a dilute solute in a solvent

What is the new equilibrium level of y : By assuming there is no change in the level of the MPC and MPS and planned investment jumps by 200 and is sustained at that higher level, recomputed the table. What is the new equilibrium level of Y Is this consistent with what you compute using t..

Compute the simple interest earned : How many years will it take to double $1000 at 4% interest compounded semiannually? How much interest will you owe on a $1000 loan from March 3 to August 7 at 10% simple interest?

State what is temperature of boiling water in denver : What is temperature of boiling water in Denver (in?C) at an elevation of 6000 ft ? 2000 m given that atmospheric pressure at that altitude is about 0.8 atm?

Rhetorical strategies and logical structure : Examine the various strategies King uses to engage his particular audiences and what are some of the means he uses to communicate effectively with them

How many tickets would the team be able to sell : If the demand curve for the Kansas City Chiefs' tickets was Q= 500,000 - 200p and their marginal cost=0, then,a. How many tickets would the team be able to sell (ignoring capacity constraints) if it behaved as if it were in a competitive market? M..

User Account

All Pages