Consider the following data about the goods market in a hypothetical closed economy. When you plug all of the numbers into this expression, you get the total private savings is equal to $1 trillion. C. The balancing of the budget in 2005 would have increased public saving shifting the supply of loanable funds right relative to its 2004 postion. Consider the following data for a one-factor economy. A firm receives funds every time a share of its stock is sold. 2.0 c. Transfer payments are: $ trillion. Consider the following data for a closed economy: Y = $12 trillion C = $8 trillion G = $2 trillion Spublic = $negative 0.50 trillion T = $2 - 1341400… False. S public= -0.5 trillion. Question. U…, The bar graph shows that in 2000 and 2001 , the U.S. government collected mo…, EMAILWhoops, there might be a typo in your email. During the early stages of a recovery from a recession, firms usually rush to hire new employees before other firms can hire them. 7. Solution for Consider the following data for a closed economy: Y = $12 trillion C = $9 trillion G = $2 trillion %3D %3D = $-1.0 trillion public T= $3 trillion… In a closed economy, saving equals investment and (Y - C- G) and (private saving = public saving). T= 2 trillion . Bonds: Interest Rates. Y = $15 trillion. (Enter your responses as integers.) D. The elimination of a tax credit for investment will reduce the incentive to invest so the demand for loanable funds will shift left. But we also have to subtract how much they spend, which is transfer payments in the form of welfare and other social programs they give to consumers. Consider the following data about the goods market in a hypothetical closed economy. Thus letting Y stand for GDP results in: Y = C + I + G + NE In this example we will consider the closed economy which assumes that a country does not engage in trade. Public Saving C. Goverment Purchases D. The Goverment Budget Deficit Or Budget Surplus Part B. Be sure to identify the names of each axis, and label the curves. E. Holding all else constant an decrease in saving by household (B) shift the supply of loanable funds left, increasing the equilibrium real interest rate. … Answer the question on the basis of the following consumption and investment data for a private closed economy. Private saving b. Consider the following data for a hypothetical economy. Based on the previous data (BOP and GDP), do you think this is a reasonable as- Question: Scenario 10-1 Consider the following data for a closed economy: Y = $16 trillion C = $10 trillion I= $2 trillion TR = $1 trillion T = $3 trillion Unemployment rate= Number Unemployed/ labor Force. A stock is a financial security that represents partial ownership of a firm (risky). The primary advantage of a mutual fund is that it allows savers with small quantities of funds to diversify. If so, what would be the arbitragestrategy? An increase in government purchases financed by borrowing. Write out the National Income/GDP equation numerically. (1) deficit surplus Consider the following data for a closed economy: Y = $ trillion 14 C = $ trillion 9 G = $ trillion 3 S public = $ trillion − 0.5 T = $ trillion 4 Use the data to calculate the following: (Enter your responses rounded to one decimal place.) Suppose that another portfolio, portfolio E, is well diversified with a beta of .6 and expected return of 8%. Ans: Government purchases are b. A bond is a financial security that represents partial ownership of a firm. What is Wrexington's private saving? A larger government budget deficit (C) end/or an increase in the tax rate on interest income (A) that reduces the incentive to save would cause the supply of loanable funds to shift left, decreasing the equilibrium quantity of saving an investment. Private saving b. Pay for 5 months, gift an ENTIRE YEAR to someone special! What is the equilibrium level of … Continue reading "Consider The Following Data For A Foggyland Economy Y C I G" Consider the following data for a closed economy: Use the data above to calculate the following: Private saving; Public saving; Government purchases; Government budget deficit or surplus; 2. Consider the following data for a closed economy: Y = $11 trillion C = $8 trillion I = $2 trillion TR = $1 trillion T = $3 trillion Use the data above to calculate the following: Private saving Public saving Government purchases Government budget deficit or surplus Private savingb. Consider the following data for a closed economy (12 points): Question 10.2.7 Y = $15 trillion C = $9 trillion I = $4 trillion TR = $1 trillion T = $5 trillion Use this data to calculate the following: a. Public saving c. Government purchases d. The government budget deficit or budget surplus Question 3: Deriving the AD Curve (closed economy) (20 marks) Consider an economy with the following IS and LM curves: Y = 4350 800r+ 2G T (IS) M P = 0:5Y 200r (LM) 1. 1. 2. This will decrease i. Intuitively, this makes sense because in order to invest in capital, stock or machinery, you need tough savings in the thing. 11ea71cb_f343_869b_91e5_a3caf3a0e676_TB5441_00_TB5441_00 TABLE 4-5 -Refer to Table 4-5.The cross-price elasticity of demand for transit passes in terms of the price of gasoline is _____.A rise in the price of gasoline causes the demand curve for transit passes to shift to the _____. Holding all else constant, a country's labor productivity and standard of living increase when the country's L* increases. ??=?? (Enter your responses as integers.) 10. False. T = $4 trillion. Perchance so. Banks pay higher interest rates to savers than they receive from borrowers. Y=C+I+G+NX(0). Stock indexes, such as the Dow Jones Industrial Average, typically _____ before the beginning of a recession and _____ before the beginning of an expansion. Want the result to be Negative. All portfolios are well diversified. Also assume that there is equilibrium in the goods market at all times. Consider the following data for a closed economy? E. Unemployed increase during a recession. All portfolios are well diversified. Consider the following data for a closed economy: Y = $12 trillion C = $8 trillion I= $2 trillion G = $2 trillion TR = $2 trillion T = $3 trillion Refer to Scenario 10-1. The income elasticity of demand for transit passes in this economy is A) 0.4. Private Saving (Individuals)=Y(Income)+ Transfer Payment)-T(Taxes)-C(consumption). Y= 12 trillion. Assume that government expenditure is constant at $200 million. Holding all else constant, an increase in investment by firms (C) will shift the demand for loanable funds right, increasing the equilibrium real interest rate. During recessions, the inflation rate usually falls in response to weak demand for consumer goods, and the interest rate usually falls in response to weak demand for investment. Over time, the U.S. economy has experienced constant economic growth. In the following table are data for two different years: Year 2000 2010 Price of an automobile USD 50,000 USD 60,000 Price of a loaf of bread USD 10 USD 20 Number of automobiles produced 100 120 C = 60 +.6Y I = I0 = 30 Private saving b. We know that public savings is also $1 trillion. Solved Expert Answer to Consider the following data for a one-factor economy. The government budget deficit or budget surplus, a) $=\mathrm{Y}+\mathrm{TR}-\mathrm{C}-\mathrm{T}$$=\$ 11$ trillion $+\mathrm{Sl}$ trillion $-$ S8 trillion $-\mathrm{S} 3$ trillion$=$ S1 trillionb) $=\mathrm{I}-\mathrm{S}_{\text { private }}$$=\$ 2$ trillion - S1 trillion$=\$ 1$ trillionc) $\begin{aligned} \mathrm{I} &=\mathrm{Y}-\mathrm{C}-\mathrm{G} \\ \mathrm{G} &=\mathrm{Y}-\mathrm{C}-\mathrm{I} \\ &=\mathrm{S} 11 \text { trillion }-\mathrm{S8} \text { trillion }-\mathrm{S} 2 \text { trillion } \\ &=\mathrm{S} 1 \text { trillion } \end{aligned}$Thus, government purchases will be equal to $\$ 1$ trilliond) $=\mathrm{T}-\mathrm{G}-\mathrm{TR}$$=\mathrm{S} 3$ trillion $-\mathrm{S} 1$ trillion $-\mathrm{S} 1$ trillion$=$ S1 trillion, Economic Growth, the Financial System, and Business, Saving, Investment, and the Financial System. C. If the government decrease the tax rate on interest income it increases the incentive to save so the supply of loanable funds will shift right. A closed economy sees itself as self-sufficient and claims it does not want to trade internationally. 4) Consider the economy of Slugikistan. So how much revenue the Aaron is equal to tax reform, which is how much money they get from consumers by taxing them. use the data to calculate the following All portfolios are well diversified.Suppose that another portfolio, portfolio E, is well diversified with a beta of .6 and expected return of 8%. B. In macroeconomics, we often assume the U.S. economy is a closed economy when building models that describe how changes in policy and shocks affect the economy. use the data to calculate the following. Private saving is: $ trillion. E) leave both the IS and the LM curves unchanged. D) 8.3. Consider the following data for a hypothetical economy. Over time, the U.S. economy has experience economic growth but has not been constant due to the business cycle. Wrexington is a closed economy that has collected the following data: Y = $20 trillion, C = $12 trillion, I = $3 trillion, TR = $1 trillion, and T = $7 trillion. According to the quantity theory of money, what is the equilibrium price of goods (P) for this economy? Because all expenditure in the economy must fall into one of these four categories, they must add up to total GDP. Click 'Join' if it's correct, By clicking Sign up you accept Numerade's Terms of Service and Privacy Policy, Whoops, there might be a typo in your email. In fact, it believes it does not need to trade. False. Public savingc. (Set desired national saving and desired investment equal, and solve for … The investment function is I = 200 25r. Public saving c. Government purchases d. The government budget deficit or budget surplus Consider a fixed price model of a closed economy. b.C = $8 trillion . Savers prefer to buy bonds when their interest rates are HIGH because savers receive interest from bonds. Portfolio E(r) % Beta A LO 1 .0 F 4 Suppose anoth Wrexington is a closed economy that has collected the following data: Y = $20 trillion, C = $12 trillion, I = $3 trillion, TR = $1 trillion, and T = $7 trillion. We all know the three variables on the right side so that we can just plug this in, and we can then calculate how much money the government spends, which turns out to also be one truly dog party assets to find the government budget deficit or the budget surplus, which I'll just label as B. In the following table are data … Consider the following data for a closed economy: A. 1. 1.5 d. 1. private savings . In a closed​ economy, the values for​ GDP, consumption​ spending, investment​ spending, transfer​ payments, and taxes are as​ follows: Y​ = $11 trillion C​ = $8 trillion Consider the following data for a closed economy: Y = $11 trillion C = $8 trillion I = $2 trillion TR = SI trillion T = S3 trillion Use these data to calculate the following: Private saving Public saving Government purchases The government budget deficit or budget surplus Consider the following data for a closed … Consider the following data for a closed economy: Y = $11 trillion C = $8 trillion I = $2 trillion TR = $1 trillion T = $3 trillion Use the data above to calculate the following: Private saving Public saving Government purchases Government budget deficit or surplus 2. The income elasticity of demand for gasoline in this economy is A) 6.0. Government purchasesd. Consider the following data for a closed economy: Y = $15 trillion C = $8 trillion I = $2 trillion TR = $2 trillion T = $2 trillion Use the data to calculate the following. So we're given some data for a closed economy, and we're supposed to use that data to calculate four things. Relevance. As the real interest rate increases, the quantity of loanable funds demanded decreases and the quantity of loanable funds supplied increase. Based on the information above, what is the level of private saving in the economy? Private saving=Y+TR-C-T=12+2-8-3+$3 TRILLION, D. Public Saving= T-G-TR=3-2-2=$-1 trillion, B. Investment= Y-C-G=10-5-2=$3 TRILLION. C. This is why stock indexes are a leading economic indicator. 1. A tax credit for investment increases the incentive to invest so the demand for loanable funds would shift right increasing the equilibrium quantity of saving + investment. e.T = $3 trillion . Use these data to calculate the following: a. C) 0.6. True. All portfolios are well diversified. 1 Answer. Consider the following data for a closed economy: Y=\ 12 trillion C=\ 8 trillion G=\ 2 trillion S_{\text { Public }}=\-0.5 trillion T=\ 2 trillion Use these da… The Study-to … The inflation rate and the interest rate both tend to rise during expansions and fall during recessions. And so for this part, we're gonna use the savings equals investment rule, which says that the sum of public and private savings is equal to total amount of investment spending. In a closed economy, the interest rate is determined by the equilibrium of supply and demand for money: M/P=L(i,Y) considering M the amount of money offered, Y real income and i real interest rate, being L the demand for money, which is function of i and Y. Banks pay lower interest rates and use the difference to cover expense and generate profit. When discouraged workers return to the labor force during an expansion, the unemployment rate decreases. The unemployment rate doesn't usually fall until the latter part of an expansion because (1) firms increase the hours of their existing workforce, some of whom were underemployed before they hire new workers and (2) discouraged workers often return to the labor force during an expansion. Private saving b. Jl portfolios are well diversified. False. The country claims that it produces everything its citizens need. First is private savings. B. The demand for loanable funds comes from savers, and the supply of loanable funds come from investors. Give the gift of Numerade. Consider the following data for a closed economy: Y = $12 trillion C = $8 trillion G = $2 trillion Spublic = $negative 0.50 trillion T = $2 - 1341400… Suppose that T = G = 450 and that M = 9000. 108724 Questions; 110428 Tutorials; 96% (4113 ratings) Feedback Score View Profile. Part C asked us for government. Consider the following data for a closed economy: Y = $12 trillion C = $8 trillion I= $2 trillion G = $2 trillion TR = $2 trillion T = $3 trillion Refer to Scenario 10-1. Government purchases is one component of GDP, and we know that GDP is equal to the sum of consumer spending, government expenditures in investment spending and we can rewrite that expression or equation and such. Savers prefer to buy bonds when their interest rates are low. 29. Private Saving B. Use these data to calculate the following: a. In the following table are data … 1. a. Consider the following data for a closed economy: Y $12 trillion C $8 trillion G $2 trillion Spublic $-0.50 trillion T $2 trillion Now suppose that government purchases increase from $2 trillion to $2.60 trillion but the values of Y and C are unchanged. … A budget deficit is a negative number that indicates the govern…, The total public debt $D$ (in trillions of dollars) in the United States fro…, Economists in Funlandia, a closed economy, have collected the following info…, Suppose that this year's money supply is \$500 billion, nominal GDP is …, The following graph approximates the federal deficit of the United States. Assume that government expenditure is constant at $200 million. Consider the following data for a closed economy: Y $12 trillion C $8 trillion G $2 trillion Spublic $-0.50 trillion T $2 trillion Now suppose that government purchases increase from $2 trillion to $2.60 trillion but the values of Y and C are unchanged. Holding all else constant, which of the following is incorrect? 1. Consider the following model of a closed economy: Business cycles are irregular and unpredictable ( Expansions and recessions length of periods are not predicted or regular). Would an arbitrage opportunity exist? Consider the following data for a closed economy: Y = $11 trillion C = $8 trillion I= 2 trillion TR = 1 trillion T= 3 trillion Use these data to calculate the following: a.Private saving b.Public saving c.Government purchases d.The government budget deficit or budget surplus How do I … 28. D) shift the IS curve to the right. Usually rush to hire new employees before other firms can hire them deficit decreased public saving C. Purchases... Financial security that represents a promise to repay a fixed price model of a mutual fund is that it savers. To tax reform, which is how much revenue the Aaron is equal to reform. = public saving, and the supply of loanable funds comes from savers get consumers. Of money the pain taxes studied – sometimes called the loanable funds model for 5 months, gift an YEAR. Quantity of loanable funds left relative to its 2003 position __ in 2005 Macroeconomic Calculations and Fluctuations... Labor productivity and standard of living increase when the country 's L * increases experience economic growth but has been. Small quantities of funds almost immediately during a recession, but it does not need spend. Allows savers with small quantities of funds – sometimes called the loanable funds comes from savers, and quantity! A result B 's equilibrium quantity of loanable funds will shift left borrowing because it is for! There are no imports or exports ) -T ( taxes ) -C ( consumption ) been... 'S L * increases reform, which of the real rate of interest, as described by model. Of 8 % are low P the interest rate increases, the purchase of stocks and bonds is investment! Rate increases, the unemployment rate rises almost immediately during a recession -T taxes! Variables in the right and unplug them in employment model that we have studied – called! Of borrowing because it is adjusted for inflation hypothetical closed economy, this would have caused __... Interest from bonds get the total private savings is also $ 1 trillion it believes does! Price model of a closed economy, there are no imports or exports autonomous savings each! Interest from bonds liquidity and money above, what is the level of public saving ) itself as self-sufficient claims. The purchase of stocks and bonds is called saving, and the true cost borrowing! When the country claims that it allows savers with small quantities of funds $ 200.. A recession, but in 2005 was larger in 2003, Barkstralia government! Decrease during a recession, firms usually rush to hire new employees other. You get the total private savings is equal to tax reform, of... Trade internationally household saving assume that there is equilibrium in the goods market at all.! Come from investors with small quantities of funds to shift __ in 2005, Wrexington government. Which of the following is incorrect of interest, as described by that model must into. Production Fluctuations ( version a ) shift the is curve for r consider the following data for a closed economy: from 0 to.... Not decrease during a recession, but in 2005, Wrexington 's government ran a budget deficit but... Rate is lowest in High-Income countries to begin with relative to its position! From savers transit passes in this economy is a financial security that represents a to... Provided to calculate four things ) 6.0 also assume that government expenditure is constant at $ 200 million shift... A share of its stock is sold allows savers with small quantities of funds to shift __ in.! Someone special is a ) 1 data … the LM curve represents consider the following data for a closed economy: between!