Exam 30: The Aggregate Expenditures Model

(Advanced analysis)Answer the question on the basis of the following information for a private closed economy,where I_g is gross investment,S is saving,and Y is gross domestic product (GDP). ==80 =-80+0.4 Refer to the information.In equilibrium saving will be:

In a private closed economy,when aggregate expenditures exceed GDP:

At the equilibrium GDP for a private open economy:

Other things equal,a serious recession in the economies of U.S.trading partners will:

In a private closed economy _____ investment is equal to saving at all levels of GDP and equilibrium occurs only at that level of GDP where _____ investment is equal to saving.

In a mixed closed economy:

In a mixed open economy,if aggregate expenditures exceed GDP:

If the MPC is .50 and the equilibrium GDP is $40 billion below the full-employment GDP,then the size of the recessionary expenditure gap is:

(Advanced analysis)Answer the question on the basis of the following information for a mixed open economy.The letters Y,C_a,I_g,X_n,G,and T stand for GDP,consumption,gross investment,net exports,government purchases,and net taxes respectively.Figures are in billions of dollars. =25+0.75(Y-T) ==50 ==10 G ==70 T ==30 Refer to the information.If the economy's tax schedule was T = .2Y rather than T = T₀ = 30,the equilibrium GDP would be:

If government increases its tax revenues by $15 billion and the MPC is 2/3,then we can expect the equilibrium GDP to:

A $10 billion decrease in taxes will increase the equilibrium GDP by more than would a $10 billion increase in government expenditures.

(Advanced analysis)Answer the question on the basis of the following information for a private closed economy,where I_g is gross investment,S is saving,and Y is gross domestic product (GDP). ==80 =-80+0.4 Refer to the information.The equilibrium GDP will be:

In which of the following situations for a mixed open economy will the level of GDP expand?

In an aggregate expenditures diagram,equal increases in government spending and in lump-sum taxes will:

Answer the question on the basis of the following information for a private closed economy: \1 00 \ 100 200 160 300 220 400 280 500 340 600 440 15\% \ 0 12 40 9 80 6 120 3 160 0 200 Refer to the information.If the real interest rate is 9 percent,the equilibrium GDP will be:

For a private closed economy,an unintended decline in inventories suggests that:

The level of aggregate expenditures in the private closed economy is determined by the:

(Advanced analysis)Answer the question on the basis of the following consumption and investment data for a private closed economy.Figures are in billions of dollars. C = 60 + .6Y I = I₀ = 30 Refer to the data.The equilibrium level of income (Y)is:

Answer the question on the basis of the following data for a private closed economy. Possible Levels of Domestic \3 20 \ 320 330 327 340 334 350 341 360 348 370 355 380 362 Refer to the data for a private closed economy.If gross investment is $12 billion,the equilibrium level of GDP will be:

(Advanced analysis)Answer the question on the basis of the following data for a private closed economy.The letters Y,C,S,and I are used to represent real GDP,consumption,saving,and investment respectively. \ \ 0 \ 60 \ 30 100 120 40 200 180 50 300 240 60 400 300 70 500 360 80 The equation representing the investment schedule for the economy is: