« previous next »

Author Question: If an economy experiences a 0.8 trillion increase in investment resulting in an increase in real GDP ... (Read 114 times)

Jramos095

  • Hero Member
  • *****
  • Posts: 528
on: Jun 29, 2018
If an economy experiences a 0.8 trillion increase in investment resulting in an increase in real GDP from 10 trillion to 12 trillion,
 
  a. what is the change in equilibrium expenditure?
  b. what is the change in autonomous expenditure?
  c. what is the multiplier?
  d. how would an increase in the marginal tax rate effect the multiplier?

Question 2

If the real interest rate is less than the equilibrium real interest rate, there is a ________ of loanable funds, and ________.
 
  A) shortage; savers increase their saving supply to restore the equilibrium
  B) shortage; borrowers have an easy time finding the funds they want
  C) surplus; some borrowers cannot find the funds they want
  D) shortage; some borrowers cannot find the funds they want
  E) surplus; borrowers have an easy time finding the funds they want


vickybb89

  • Sr. Member
  • ****
  • Posts: 347
Reply #1 on: Jun 29, 2018
Answer to Question 1

a. The change in equilibrium expenditure is 2.0 trillion.
b. The change in autonomous expenditure is 0.8 trillion.
c. The multiplier is 2.5.
d. An increase in the marginal tax rate decreases the size of the multiplier.

Answer to Question 2

D


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

The U.S. Preventive Services Task Force recommends that all women age 65 years of age or older should be screened with bone densitometry.

Did you know?

Street names for barbiturates include reds, red devils, yellow jackets, blue heavens, Christmas trees, and rainbows. They are commonly referred to as downers.

Did you know?

Though methadone is often used to treat dependency on other opioids, the drug itself can be abused. Crushing or snorting methadone can achieve the opiate "rush" desired by addicts. Improper use such as these can lead to a dangerous dependency on methadone. This drug now accounts for nearly one-third of opioid-related deaths.

Did you know?

In women, pharmacodynamic differences include increased sensitivity to (and increased effectiveness of) beta-blockers, opioids, selective serotonin reuptake inhibitors, and typical antipsychotics.

Did you know?

In Eastern Europe and Russia, interferon is administered intranasally in varied doses for the common cold and influenza. It is claimed that this treatment can lower the risk of infection by as much as 60–70%.

Illustration of an embolus floating in an artery. The embolus will become lodged in a blood vessel t Illustration of an embolus floating in an artery. The embolus will become lodged in a blood vessel t
Arthrocentesis. The aspiration of fluid is a common treatment for joint injuries resulting in inflam Arthrocentesis. The aspiration of fluid is a common treatment for joint injuries resulting in inflam
An investment versus a bill An investment versus a bill
This chart illustrates the four quadrants in which we can place the relationships between the state This chart illustrates the four quadrants in which we can place the relationships between the state
Pathogenic Microorganisms and Resulting Diseases Cont Pathogenic Microorganisms and Resulting Diseases Cont
Latin America in the Global Economy Latin America in the Global Economy
Video: Oxygen - hemoglobin dissociation curve & Hemoglobin's affinity with oxygen - acidity

For a complete list of videos, visit our video library