Effect a decrease in savings would have on Equilibrium
Increase
100
Imports are equal to Exports. Net Exports is...
0
100
MPS is .55. What is the Tax Multiplier
(-).81
100
GDP at level 1 is $500 billion, Consumption at level 1 is $540 billion, GDP at level 2 is $540 billion, Consumption is $560 billion What will the equilibrium be?
$580 billion
100
Spending multiplier is 2.2. What is the MPC
.55
200
Imports are considered a what?
Leakage
200
Effect on AE line when exports are greater than imports
Increase
200
Government Spending is $65 billion, Taxes are $60 Billion. MPC is .7; What is the change in GDP
Increases by $76 billion
200
GDP rises at a rate of $35 billion per round, Consumption rises at a rate of $25 billion per round. What is the MPC
.71
200
Tax multiplier is (-)3. What is the MPS
.25
300
MPC is .75, Inflationary gap is $4 billion. Where is the equilibrium in relation to the full employment line
$8 billion above it
300
How much will the equilibrium shift if Net Exports is $5 billion
Not enough information to answer
300
equilibrium is $700 billion. MPC is .65; Taxes decrease by $5 billion, Government spending increases by $23 billion. What is the new equilibrium?
$779.99 billion
300
GDP at level 1 is $600 billion, level 2 is $630 billion, level 3 is $660 billion. Consumption at level 1 is $645 billion, level 2 is $670 billion, level 3 is $685 billion. What is the MPC
N/A - Consumption is not increasing by a constant rate
300
Tax multiplier is (-)4, government spending multiplier is 6. What is the MPC?
Not Possible
400
MPC is .9; Recessionary Gap is $7.5 billion. Where is the equilibrium in relation to the full employment line
$75 billion below it
400
How much will equilibrium shift is net exports is negative $646 billion. MPC is .75
$2.584 trillion
400
How do you keep a balanced budget and increase the GDP
Keep taxes and government spending the same amount
400
Imports are $1.9 trillion, Exports are 1.3 trillion. How much will Consumer spending need to increase in order to make up the difference in net exports
$600 billion
400
What are the injections and leakages into the income-expenditures stream. What happens with them at equilibrium?
Injections are government spending, exports, and investment; Leakages are savings, taxes and imports. The equal each other at the equilibrium
500
MPC is .8; Government tries to fix recessionary gap by increasing spending by $6 billion, and decreasing taxes by $3 billion raising the new equilibrium to $510 billion, which causes a inflationary gap of $2 billion. What is the original recessionary gap?
$6.4 billion
500
U.S. imports $1.9 trillion. How much will the U.S. need to export in order to improve the GDP by $15 trillion. MPC is .8
$4.9 trillion
500
U.S. wants to reduce the budget deficit by $500 billion. Devise a plan concentrating on taxes and government spending on how you will do that. What will be the impact on the GDP
Answers will vary
500
Create a hypothetical economy in which the MPS is .8
Answers will vary
500
MPC is .75, Equilibrium is $900 billion in 2010. Taxes increase by $30 billion and Government spending increases by $23 billion in 2011. Taxes decrease by $17 billion and Government spending decreases by $6.5 billion in 2012. What is the new equilibrium?