Calculate permanent income, Basic Statistics

Assignment Help:

Suppose that permanent income, YP_(t) is calculated as the average of disposable income (YD_t) over the past 5 years, that is:

YP_(t)= 0.2(YD_t + YD_t-1 + YD_t-2+ YD_t-3YD_t-4)

Suppose further that consumption is given as

C = 0.9 YP_(t)

a. If you earned $20,000 per year for the past 10 years, what is your permanent income?

b. Suppose that next year, (t + 1), you earn $30,000. What is you new permanent income?

c. What is your consumption this year and next year (i.e., C_t and C_{t + 1})?

d. What is your short-run (1-year) and long-run MPC?

Related Discussions:- Calculate permanent income

Obtain the critical value for a hypothesis test, Obtain the critical value ...

Obtain the critical value (or values) for a hypothesis test for the mean if you conduct: (a) an upper tail "z" test at the 1% level of significance. (b) a two-tailed "z" test

Calculate and interpret, U.S. College presidents have described alcohol abu...

U.S. College presidents have described alcohol abuse as the number one problem on campus. How common is it? As a super crackerjack student, you conducted a survey of 17,096 stude

Four characteristics and functions of statistics, highlight four characteri...

highlight four characteristics and four functions of statistics

Example on cluster sampling, "A company of accountants has branches in fiv...

"A company of accountants has branches in five regions, Port Louis (PL), Curepipe (CPE), Beau Bassin (BB), Rose Hill (RH) and Quatre Bornes (QB). It employs the following number

Mode, things to be investigate in mode

things to be investigate in mode

Comprehending Behavior Statistics, I was recently buying shoes when the sal...

I was recently buying shoes when the salesperson commented on how large my feet were. After telling him he had lousy sales techniques, I decided to investigate if I really do have

Method of least squares, what is method of least squares

what is method of least squares

Manufacturing overhead referred to as factory overhead, Manufacturing overh...

Manufacturing overhead referred to as factory burden, factory overhead, and manufacturing support costs refers to indirect factory related costs which are incurred when a product i

The number of degrees of freedom, Use the given information to find the num...

Use the given information to find the number of degrees of? freedom, the critical values chi Subscript Upper L Superscript 2?2L and chi Subscript Upper R Superscript 2?2R?, and the

Spss data analysis assignment, At the end of their first year of teaching, ...

At the end of their first year of teaching, 11 teachers were jointly ranked by two school administrators to reflect their relative degree of teaching competence. Unknown to the adm

Write Your Message!

Name

Email id

Message

Verfication Code

User Account

All Pages