This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: In the above diagram, what happens if the real GDP is 3 trillion? 5 trillion? 7 trillion? What is ... (Read 88 times)

cherise1989

  • Hero Member
  • *****
  • Posts: 555
on: Jun 30, 2018
In the above diagram, what happens if the real GDP is 3 trillion? 5 trillion? 7 trillion? What is the equilibrium level of real GDP? Why?
 
  What will be an ideal response?

Question 2

Technical support provided by an Indian firm to a multinational company headquartered in New York is an example of a(n) ________.
 
  A) capital account transaction B) export of services by India
  C) transfer payment to the U.S. D) import of services by India


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

AISCAMPING

  • Sr. Member
  • ****
  • Posts: 347
Reply #1 on: Jun 30, 2018
Answer to Question 1

At real GDP of 3 trillion, planned real investment is greater than real saving, which means households are buying more than producers had anticipated. There is an unplanned inventory decrease of 500 billion, and businesses increase production and hiring. At 5 trillion, planned real investment and planned real saving are equal, so this is the equilibrium. At 7 trillion, planned real saving is greater than planned real investment so there is an unplanned increase in inventories of 500 billion. Businesses reduce production and lay off workers, forcing real GDP back towards 6 trillion.

Answer to Question 2

B


cherise1989

  • Member
  • Posts: 555
Reply 2 on: Jun 30, 2018
:D TYSM

amcvicar

  • Member
  • Posts: 341
Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

« previous next »
 

Did you know?

Coca-Cola originally used coca leaves and caffeine from the African kola nut. It was advertised as a therapeutic agent and "pickerupper." Eventually, its formulation was changed, and the coca leaves were removed because of the effects of regulation on cocaine-related products.

Did you know?

All patients with hyperparathyroidism will develop osteoporosis. The parathyroid glands maintain blood calcium within the normal range. All patients with this disease will continue to lose calcium from their bones every day, and there is no way to prevent the development of osteoporosis as a result.

Did you know?

There are more bacteria in your mouth than there are people in the world.

Did you know?

Though Candida and Aspergillus species are the most common fungal pathogens causing invasive fungal disease in the immunocompromised, infections due to previously uncommon hyaline and dematiaceous filamentous fungi are occurring more often today. Rare fungal infections, once accurately diagnosed, may require surgical debridement, immunotherapy, and newer antifungals used singly or in combination with older antifungals, on a case-by-case basis.

Did you know?

Medication errors are three times higher among children and infants than with adults.

Human Body Muscle Diagram Human Body Muscle Diagram
Endoscope Diagram Endoscope Diagram
back of neck diagram back of neck diagram
Mixing schematic Diagram CHE 415 unit operations experiment apparatus Mixing schematic Diagram CHE 415 unit operations experiment apparatus
Schematic diagram showing polyclonal response by B cells against linear epitopes. Schematic diagram showing polyclonal response by B cells against linear epitopes.
Prove that each of the following real functions f has a discontinuity. For each function, ... Prove that each of the following real functions f has a discontinuity. For each function, ...
Video: Coronary Heart Disease

For a complete list of videos, visit our video library