Compute private saving

Assignment Help Macroeconomics
Reference no: EM131090634

1. A production function can exhibit increasing, constant or decreasing returns to scale. Describe the meaning of this statement using a simple production function Y = F (K, L), where K is capital and L is labor.  Why might it exhibit increasing or decreasing returns to scale?

2. Consider an economy described as follows:

Y = C + I + G

Y = 10,000

G = 3,000

T = 2,200

C = 1500 + 0.75(Y - T)

I = 1000 - 75r

a. Compute private saving, public saving and national saving in this economy

b. Fin the interest rate that maintains equilibrium in the economy.

c. Suppose that G is reduced by 500. Compute private saving, public saving and national saving and new equilibrium interest rate

d. Suppose that T is increased to 3,000. Compute private saving, public saving and national saving and the effect on the equilibrium interest rate.

Reference no: EM131090634

Questions Cloud

What would consider two challenges of reading shakespeare : When a writer wants to reveal specific problems the writer has with society, the writer will sometimes use a technique called irony. Review the reading on irony in this unit. Then, find and explain two examples of irony in Lysistrata. In what way ..
Active monetary policy and passive monetary policy : Explain the difference between active monetary policy and passive monetary policy, commenting on the Federal Reserve's use of monetary policy since the early 1980s.
Produce a new system for future installations : The new computer-controlled conveyor belt is an exciting project that moves and positions items on a conveyor belt with a high degree of accuracy (
Impact of problem on work environment and patient outcomes : How does each article describe the nature of the problem, issue, or deficit you have identified and does each article provide statistical information to demonstrate the gravity of the issue, problem, or deficit?
Compute private saving : Suppose that G is reduced by 500. Compute private saving, public saving and national saving and new equilibrium interest rate Suppose that T is increased to 3,000. Compute private saving, public saving and national saving and the effect on the equi..
Producing the optimal number of cell phones : Although the last 3,000 cell phones we produced and sold increased our revenue by $6,000 and our costs by $6,700, we are still making an overall profit of $5,000 per week so I think we're on the right track. We are producing the optimal number of ..
How much will each firm produce in the long-run equilibrium : Suppose that sprockets are a perfectly competitive, constant cost industry with a large number of identical firms who have a long run total cost curve of TC(Q)=Q^3−4Q^2+10Q. The market demand curve is Q^D=250−2P. What is the long-run equilibrium pric..
Why do you say law enforcement should not be involved : Should local law enforcement be playing a role in the fight against terrorism? If so, what role should they play? If not, why do you say law enforcement should not be involved?
What is the maximum bandwidth of this network, in bytes/s. : what is the maximum bandwidth of this network, in bytes/s.

Reviews

Write a Review

Macroeconomics Questions & Answers

  Price wars beneficial to both consumers and industries

"The recent price wars in the supermarket and mobile phone industries have been beneficial to both consumers and their respective industries." Discuss critically, using all the recent theoretical models.

  Increased military spending

The Federal Government had a budget surplus in 2001 but a budget deficit in 2002. This was due to the recession, the tax cut, and the increased military spending. The change from a budget surplus to a budget deficit was due to Midterm 4.0.pages

  Calculate the economic growth rate

The approximate number of years it takes for real GOP pee person in Japan (0 double if the real GDP economic growth rate returns to 3 percent a year and the population growth race is maintained

  Profit maximization and expected profit in recession

Suppose that the car manufacturer allows the car dealer to return all unsold cars at the end of a recessionary year. What is the car dealer's profit in a growth year and in a recession? What is their expected profit?

  Find if there dominant and dominated strategies

Firm 1 and firm 2 are movie producers. Each has the option of producing a blockbuster romance or a blockbuster suspense film. The payoff matrix displaying the payoffs for each of the four possible strategy combinations.

  Have any gross income as a result of this transaction

Markum Corporation owes a creditor $60,000. Markum transfers property to the creditor to satisfy the debt. Markum purchased the property four years ago for $45,000 and it is currently worth $60,000. Does Markum have any gross income as a result of th..

  What are some of the impediments to hiring

We are in the midst of a slow growing economy in the aftermath of a severe recession. During the economic downturn many businesses laid off workers very quickly once they forecast their sales were dropping. What is the economic reasons behind cutt..

  Processing equipment to the plant to aid in the removal

The New England Soap Company is considering adding some processing equipment to the plant to aid in the removal of impurities from some raw materials. By adding the processing equipment, the firm can purchase lower-grade raw material at reduced cost ..

  International marketplace system to allocate resources

The extensive application of protective tariffs destroys the ability of the international marketplace system to allocate resources efficiently.

  Encourage economic growth for the typical firm

The World Bank is currently advising newly industrialized countries on how to encourage growth and they have asked for your help.

  The civil war decreases labour productivity in syria

3. If the civil war decreases labour productivity in Syria, explain what will happen to the followinga. Potential GDPb. Employmentc. The real wage rate.

  What is the marginal tax rate in waxwania

a. What is the marginal tax rate in Waxwania? percent The average tax rate? percent Which of the following describes the tax system: proportional, progressive, regressive?

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