By how much will consumption decline

Assignment Help Econometrics
Reference no: EM131142132

Suppose households save 5 percent of their disposable income. If the government increases expenditures and taxes by $100 billion, by how much will saving decline? By how much will consumption decline? What happens to investment? (Assume a closed economy.)

Reference no: EM131142132

Questions Cloud

How much did prices rise during the civil war : Wartimes are usually associated with inflation. According to the Inflation Calculator at www.bls.gov/cpi/home.htm, what would $100 in 1860 be worth in 1865? By how much did prices rise during the Civil War?
Describe situation with the drugs crossing border into us : Describe the situation with the drugs crossing the border into the United States. Is it possible to adequately address this issue and not affect the US / Mexican economic status?
Are there protective measures in place to ensure its safety : Provide any information that you feel is unique to each sector. In your local community, research the infrastructure, and identify one particular element that may be of particular interest to a terrorist or vulnerable to natural or manmade disaste..
What is translation adjustment determined solely for 2015 : If this is a translation. what is the translation adjustment determined solely for 2015? - If this is a remeasurement. what is the remeasurement gain or loss determined solely for 2015?
By how much will consumption decline : Suppose households save 5 percent of their disposable income. If the government increases expenditures and taxes by $100 billion, by how much will saving decline? By how much will consumption decline? What happens to investment? (Assume a closed e..
Compute the per-unit resistance of the load : Determine the load resistance in ohms referred to the high-voltage side and the per-unit value on the chosen base.
Why are they important components of theoretical schemes : What are the key differences between the 4 identified types of research theories listed in the assignment instructions? Is anyone type of theory more valid than the others? Why or why not?
Discuss the effect on employment and output : discuss the effect on employment, output, the real rate of interest, investment, and saving if households become more optimistic about the future and as a result reduce their current saving.
Compute the per-unit reactance of the transformer : Compute the per-unit reactance of the transformer - what value of the per-unit reactance should be used to represent this transformer?

Reviews

Write a Review

Econometrics Questions & Answers

  What is johns elasticity of demand at his profit-maximizing

John runs the only carwash in town; he is a monopolist. John estimates his daily demand for carwashes is given by the expression Q = 100?4P, where Q is the number of carwashes drivers will purchase at price P. It costs John $5 in electricity, soap..

  Why was it not followed up

In many instances, the invoices were prepared without knowledge of the customer.

  Define a competitive equilibrium for this economy

Can all Pareto optima be decentralized without changing endowments? Can they be decentralized by redistributing endowments?

  Compute the inflation rate for each year

Compute the inflation rate for each year 1989-2006 and determine which were years of inflation. In which years did deflation occur In which years did disinflation occur Was there hyperinflation in any year

  Determine what is the optimal number of fig leafs

What Gimbo most enjoys for dinner is eating fig leafs (F) and to accompany his meal with nothing better than an Arak (A) drink on the rocks. His utility function is represented by this equation : U=33(F)(A^2). Gimbo has $100 to spend on dinner dur..

  What is the pdv of the net earnings under the plan

Suppose that college education raises a person's wage by $30,000 per year, from $40,000 to $70,000. Assume that the interest rate is 3 per cent and there is no growth in wages. Suppose you are a high school senior and deciding whether or not to go..

  What could firm a do to make the threat credible

Show how the payoff matrix in the table for Problem 10 might change if firm A were to make a credible threat to lower the price by building excess capacity to deter frim B from entering the market. (a) indicate the best strategy for each firm.

  What would you expect to earn after your raise

Suppose you are currently earning $15 an hour. If the inflation rate over the current year is 10 percent and your firm provides a cost-of-living raise based on the rate of inflation, what would you expect to earn after your raise? If the cost-of..

  What is the profit-maximizing price for the two products

What are the profit-maximizing price that High-Tech should charge if they sell each product separately and what is the total price of the two goods?

  Determine the total market value of all final goods

Suppose the total market value of all final goods and services produced this year in economy X is $4 million. Of the $4 million worth of goods, $3 million is sold and $1 million is held in inventory. For this year, the GDP for economy X is

  What is the optimal value of x of an utility function

Suppose there is a risky stock which returns $4 with probability 0.5 and 0 with probability 0.5 for every dollar invested. Suppose for every dollar, I invest a share x in A and (1-x) in risk free government bonds.

  How congress decides whether to relax the import quota

Edwina, a commoditiesbroker, has acquired an option to buy 1,000 oz of gold at $50/oz.If she takes her option and Congress relaxes the import quotas, shecan sell the gold for $80/oz. If she takes the option and Congressdoes not relax the import qu..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd