This topic contains a solution. Click here to go to the answer

Author Question: Using the values in the table above, and assuming that the real interest rate equals 4, calculate ... (Read 51 times)

melly21297

  • Hero Member
  • *****
  • Posts: 565
Using the values in the table above, and assuming that the real interest rate equals 4, calculate equilibrium values for consumption, household saving, investment, and net exports. Use these values to confirm that the goods market is in equilibrium.
 
  What will be an ideal response?

Question 2

In Figure 13.1, the zero lower bound is displayed at ________.
 
  A) point 1
  B) point 2
  C)
  D) the origin (intersection of the axes)
  E) none of the above



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

ntsoane kedibone

  • Sr. Member
  • ****
  • Posts: 333
Answer to Question 1

Entering the given values in the IS curve equation yields Y = 18.7. Plugging Y and r into the consumption equation yields C = 12.7. Subtracting C + T from Y gives household saving = 4. The investment equation using these values of Y and r yields I = 3.4. The net exports equation yields NX = 0.6. Note that S = NX + I - (G - T), so the goods market is in equilibrium. Also, Y = C + I + G + NX, so the goods market is in equilibrium.

Answer to Question 2

B




melly21297

  • Member
  • Posts: 565
Reply 2 on: Jun 30, 2018
:D TYSM


Sarahjh

  • Member
  • Posts: 370
Reply 3 on: Yesterday
Gracias!

 

Did you know?

More than one-third of adult Americans are obese. Diseases that kill the largest number of people annually, such as heart disease, cancer, diabetes, stroke, and hypertension, can be attributed to diet.

Did you know?

In 1885, the Lloyd Manufacturing Company of Albany, New York, promoted and sold "Cocaine Toothache Drops" at 15 cents per bottle! In 1914, the Harrison Narcotic Act brought the sale and distribution of this drug under federal control.

Did you know?

By definition, when a medication is administered intravenously, its bioavailability is 100%.

Did you know?

Since 1988, the CDC has reported a 99% reduction in bacterial meningitis caused by Haemophilus influenzae, due to the introduction of the vaccine against it.

Did you know?

Lower drug doses for elderly patients should be used first, with titrations of the dose as tolerated to prevent unwanted drug-related pharmacodynamic effects.

For a complete list of videos, visit our video library