Question 1 (a)Given the following information, calculate the level of real GDP that results in spending balance in the economy (T is taxes or tax revenue). C = 100 + 0.7 (Y - T) I = 100 G = 200 T = 200 X = 50 - 0.1Y Real GDP = C + I + G + X = Y = 100 + 0.7 (Y-200) + 100 + 200 + 50 - 0.1Y Y= 310 - 0.6Y 0.6Y = 310 Y= 775 1) What is the MPC in this example? What is the MPS? What is the MPI? How does the MPI affect the slope of the …
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showed last 75 words of 3134 total
…in 2001, Macroeconomics: a student's guide to theory and concepts, Studymates, Taunton. 5.Jackson, McIver 2001, Macroeconomics, 6th edn. McGraw-Hill, Sydney. 6.Peter E. Kennedy 2000, Macroeconomic Essentials: understanding economics in the news, 2nd edn. MIT Press, Cambridge Mass. 7.What makes the four tigers road 1960 and 1990 "GDP data concerning Ghana, the four tigers and North America" [online]. Available at URL: http://www.soc-canada.com/exes/ch10/ [Accessed 20 October 2003]. 8.Pizza Hut 2003 [online]. Available at URL: http://www.pizzahut.com [Accessed 20 October 2003].