### Illustrtae what will equilibrium gdp equal if taxes decrease

Assignment Help Macroeconomics
##### Reference no: EM1330244

Consider an economy in which investment (I) equals 400, government purchases (G) equals 800, taxes (T) equal 600, exports (X) equals 200, and imports (M) equal 250. The consumption function is:

C = 100 + 0.8(Y-T)

What is equilibrium GDP? What will equilibrium GDP equal if government expenditures increase 200? What will equilibrium GDP equal if taxes decrease 200? Why are the results different?

### Write a Review

#### By utility preferences graph the indifference curves

Discuss how your answer relates to the income and substitution effects of a price change from Knoxville food prices to Berkeley food prices.

#### Own-price elasticity of demand for x box

Sherry was just rotated out as Microsoft's X-Box sales manager for the Canadian market. In Canada, the X-Box competes with Nintendo's GameCube.

#### Merger market power

A hearing is scheduled for your company to present arguments that your firm has not increased its market power through the merger. Can you do this and how. What evidence might you bring to the hearing?

Explain the advantages and disadvantages of using a change in the tax rate to achieve the desired increase in output.

Political business cycle: Do economic events affect presidential elections? To test this so-called political business cycle theory, Gary Smith 20  obtained the following regression results based on the U.S Presidential elections for the four yearl..

#### Weaknesses of federal reserve operating procedures

Compare and contrast the strengths and weaknesses of today's Federal Reserve operating procedures and monetary decision making policy.

#### Canadian opportunity cost and production possibilities

What is opportunity cost of producing a car in Canada? What is the opportunity cost of producing the tonne of wheat in Canada? Describe the relationship between the opportunity costs of two goods.

#### Quantity demanded divided by the percentage

The percentage changes in quantity demanded divided by the percentage change in price.

#### Quantity leader in stackelberg model

Suppose there are only two firms. It is better to be a quantity leader in a Stackelberg model than a member of a cartel in a one shot market. Use a graph if you want.

#### Explain why might intangible resources such as human capital

Explain why might intangible resources such as human capital and intellectual assets be a more likely source of sustainable competitive advantage than tangible resources.

#### Euro currency and its relevance

It is the measure adopted by the Government for its UK inflation target. The Bank of England's Monetary Policy Committee is required to achieve a target of 2 per cent. Inflation is the percentage change in the index compared with the same month one..

#### Illustrate what is the price elasticity of supply

Illustrate what is the price elasticity of supply for your chosen industry.