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EC.201MacroeconomicPrinciplesHomework#311/14/2022DUE: 12/01/2022 MPC, MPS, and Spending Multiplier..... Answer all parts of this assignment. For any credit you MUST show all work (This includes formula, calculations

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EC.201MacroeconomicPrinciplesHomework#311/14/2022DUE: 12/01/2022 MPC, MPS, and Spending Multiplier..... Answer all parts of this assignment. For any credit you MUST show all work (This includes formula, calculations made, and full explanation of steps taken in arriving at your answers. Please use complete sentences!). Leave spaces ( at least two lines) between questions! ( 30 pts) I DO NOT ACCEPT HANDWRITTEN WORK! MAKE YOUR WORK NEAT AND LEGIBLE! 1. You are an economist that works for an international research agency in London ( lucky you!). You receive a call from your manager. "I think it would be very pertinent for you to study the impacts of changing income levels of spending patterns in the nation of Tantara. This is because, in the past few years, disposable income in Tantara have increased significantly due to the presence of gold mines. I will send you some data for your analysis." You are given the following data about Tantara. "When the citizens of Tantaras have no income, they spend $1,000. If income increases to $1,000, they spend $1,750, and if income increases from $1,000 to $2,000, they spend $2,500." (a) What is Tantara's autonomous consumption? Explain in full. (3 pts.) (b) Determine the marginal propensity to consume for Tantara. Show all work, that includes formula, calculations made in arriving at your answer(s). (5 pts.) (c) Interpret the marginal propensity to consume you got in (b). (3 pts.) (d) Determine the marginal propensity to save for Tantara. Show all work , that includes formula, calculations made in arriving at your answer(s). (4 pts.) (e) Determine the consumption function for Tantara. Show all work (formula, calculations made in arriving at your answer(s)). (5 pts.) (f) Determine the spending multiplier for Tantara. Show all work , that includes formula, calculations made in arriving at your answer(s). Interpret the spending multiplier. ( 3,2 pts.) (g) Assume that government of Tantara has decided to spend an additional $1,000 on police protection for its citizens. Determine the maximum change in GDP resulting from this increase in government spending. Show all work, that includes formula, calculations made in arriving at your answer(s). (5 pts.) (h) Assume that government of Tantara has decided to improve the nation's infrastructure (bridges, roads, etc.) and imposes additional tax of $500 on the citizens. Determine the maximum change in GDP resulting from this tax. Show all work, that includes formula, calculations made in arriving at your answer(s). (5 pts.) EC.201MacroeconomicPrinciplesHomework#311/14/2022DUE: 12/01/2022 MPC, MPS, and Spending Multiplier..... Answer all parts of this assignment. For any credit you MUST show all work (This includes formula, calculations made, and full explanation of steps taken in arriving at your answers. Please use complete sentences!). Leave spaces ( at least two lines) between questions! ( 30 pts) I DO NOT ACCEPT HANDWRITTEN WORK! MAKE YOUR WORK NEAT AND LEGIBLE! 1. You are an economist that works for an international research agency in London ( lucky you!). You receive a call from your manager. "I think it would be very pertinent for you to study the impacts of changing income levels of spending patterns in the nation of Tantara. This is because, in the past few years, disposable income in Tantara have increased significantly due to the presence of gold mines. I will send you some data for your analysis." You are given the following data about Tantara. "When the citizens of Tantaras have no income, they spend $1,000. If income increases to $1,000, they spend $1,750, and if income increases from $1,000 to $2,000, they spend $2,500." (a) What is Tantara's autonomous consumption? Explain in full. (3 pts.) (b) Determine the marginal propensity to consume for Tantara. Show all work, that includes formula, calculations made in arriving at your answer(s). (5 pts.) (c) Interpret the marginal propensity to consume you got in (b). (3 pts.) (d) Determine the marginal propensity to save for Tantara. Show all work , that includes formula, calculations made in arriving at your answer(s). (4 pts.) (e) Determine the consumption function for Tantara. Show all work (formula, calculations made in arriving at your answer(s)). (5 pts.) (f) Determine the spending multiplier for Tantara. Show all work , that includes formula, calculations made in arriving at your answer(s). Interpret the spending multiplier. ( 3,2 pts.) (g) Assume that government of Tantara has decided to spend an additional $1,000 on police protection for its citizens. Determine the maximum change in GDP resulting from this increase in government spending. Show all work, that includes formula, calculations made in arriving at your answer(s). (5 pts.) (h) Assume that government of Tantara has decided to improve the nation's infrastructure (bridges, roads, etc.) and imposes additional tax of $500 on the citizens. Determine the maximum change in GDP resulting from this tax. Show all work, that includes formula, calculations made in arriving at your answer(s). (5 pts.)