Closing the GDP gap In a closed economy, the behavioral equations of households, firms and government are given below: C = 200 + 0.75Yd I = 160 G = 80 t = 20% (a) Calculate the aggregate planned expenditure (AE) function. (b) Find the...
So when businesses are willing to invest, there is more debt created, thereby expanding the aggregate money supply in the economy. This can create an inflationary effect which can positively impact consumption as the money filters through the wider economy. By contrast, when businesses reduce invest...
Real GDP values current output of goods and services at their current prices. a. True b. False The return on total assets ratio is a profitability measure. True False The short-run aggregate supply (SAS) curve slopes upward because households spend more as their incomes increase....
However, short-run aggregate demand only measures total output for a single nominal price level or the average of current prices across the entire spectrum of goods and services produced in the economy. Aggregate demand only equals GDP in the long run after adjusting for price level. GDP=C+I+...
The CPI and he GDP Price Index (GDP deflator) are both: a. well suited to indexing wages, household income, or the value of household assets. b. well suited to indexing macroeconomic aggregates like national income, the trade deficit, or nominal GDP. c. m ...
Aggregate Expenses The following are the four different kinds of aggregated expenses used to measure GDP: 1. Consumer consumption About two-thirds of the GDP of the United States constitutesconsumer spending. It includes all the costs incurred by the citizens of a country within the country’s bo...
Balance of Trade Aggregate Supply and Demand GDP Formula Gross National Product See all economics resources
What is aggregate output? Aggregate income? How is deadweight loss calculated? How can the money you put into a bank get back into someone's hand as his or her income? What is the profit and loss statement? How we can determine the changes in the total revenue?
How to calculate the aggregate saving function if you are given the aggregate income and the aggregate savings? How does commodity money get its value? What happens to the aggregate price level and aggregate output from an increase in imports?
Suppose the money supply in country {eq}\displaystyle X {/eq} is {eq}\displaystyle 44000 {/eq} and nominal {eq}\displaystyle GDP {/eq} is {eq}\displaystyle 88000 {/eq}. Calculate the velocity of money and enter it below. Velocity ...