Question
1- Suppose a closed economy with no government spending or taxing is capable of producing an output of $2250 at full employment. Suppose also that
1- Suppose a closed economy with no government spending or taxing is capable of producing an output of $2250 at full employment. Suppose also that autonomous consumption is $160, intended investment is $50, and the mpc is 0.50.
How much additional autonomous spending (for instance, from the government) is needed to move the economy to full employment?
2- Suppose that Jane's income increases from $1700 per month to $2400. At the same time, her consumption changes from $900 per month to $1300 month. What is Jane's marginal propensity to consume? (Round your answer to two decimal places.)
3- Suppose output and income is equal to 11700, the marginal propensity to consume is 0.80, and autonomous consumption is 425. Calculate total saving for this economy, assuming no public or foreign sector. (Round your answer to the nearest whole number.)
4- Supposethe economy is in equilibrium, and assume no government or foreign sector. If total saving equals 67660, then intended investment must equal...
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