What are the equilibrium values of c

Assignment Help Macroeconomics
Reference no: EM132559923

Q-1: Assume that an economy is characterized by the following equations:

Y= C + I + G

Y(GDP) = 6000

C = 600 + 0.6 (Y - T)

I = 2000 - 100r

T = 500

G = 500,

where r is the real rate of interest in percent, T is tax and G is a government spending.

a. What are the equilibrium values of C, I, and r ?

b. What are the values of private saving, public saving, and national saving? If government spending rises to 1000, what are the new equilibrium?

c. values of C, I, r, private saving, public saving, and national saving?

Reference no: EM132559923

Questions Cloud

Discuss negotiation in the context of BATNA-WATNA : Discuss negotiation in the context of BATNA, WATNA, the bargaining zone, and the reservation point.
Make journal entries to record the restructuring on December : Make Jeonju Co.'s journal entries to record the restructuring on December 31, 2019, and the entries necessary to make the adjustments
Discuss some of the main actors in the microenvironment : Consider what marketing research the organization has done or can conduct in the future. Include at least one specific primary data collection
Describe medical care issues involved in situation : Describe the medical care issues involved in this situation. Describe the ethical issues that may arise based on your decision as the administrator.
What are the equilibrium values of c : What are the values of private saving, public saving, and national saving? If government spending rises to 1000, what are the new equilibrium?
Discuss the treatment modalities of neoplasm : Discuss the treatment modalities of neoplasm 1.Surgical 2.chemotherapy
What issues have to address in starting sales force : What issues would you have to address in starting your own sales force? How would you attempt to control the potential economic damage?
Credit Default Swap with maturity : Consider a Credit Default Swap with maturity 2 years, paying a premium with semi-annual frequency.
Compute the unit product cost for year : During its first year of operations, O'Brien produced 100,000 units and sold 80,000 units. Compute the unit product cost for Year

Reviews

Write a Review

Macroeconomics Questions & Answers

  Inflation targeting be a good policy

Why might it be difficult for the Fed to formally adopt inflation targeting?  Would inflation targeting be a good policy for the Fed in the present economic environment

  In using the taylor rule

In using the Taylor Rule as a guideline for monetary policy, what are the pros and cons of using forecasted values of inflation and output rather than observed values of these variables?

  Describe the present economic crisis situation in europe

Describe the present economic crisis situation in Europe.  Why has it been so difficult for the Europeans to find a solution to this problem?   Comment on what implications the crisis may have for the rest of the world if Europeans are not able to ag..

  Long-term federal government budget problems

Question:. Explain why there are long-term Federal government budget problems. Explain why the base-line forecast of the CBO is misleading.

  Derive and compare demand curve

Question based on Derive and compare demand curve,  Derive Ambrose's demand function for peanuts. How does it compare with Johnny's demand curve for peanuts?

  Problem based on utility function

Problem based on  Utility Function - Problem,  Answer and explain the following using a diagram which is completely labeled.

  Laffer curve : tax rate and tax revenue

Question based on Laffer Curve : Tax Rate and Tax Revenue,  Do raising tax rates necessarily raise tax revenue? What factors affect how tax revenue changes when tax rates change?

  Problem - income elasticity of demand

Problem - Income Elasticity of Demand,  Interpret the following Income Elasticities of Demand (YED) values for the following and state if the good is normal or inferior; YED= +0.5 and YED= -2.5

  Positive balance of payment

Question Positive Balance of Payment: "Things will look good for the US if we could just get to where we are consistently running a positive Balance of Payments."

  Effect of recession on the investment curve

Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.

  Affect of falling domestic investment on trade surplus and

How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.

  Crises in the banking sector and bank run

Banking crises crisis decreases depositors' confidence in the banking system. What would be the effect of a rumor about a banking crisis on checkable deposits in such a country?

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