Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Good evening, can i please get some help with these questions? i am struggling to answer them. thank you Explain the effect of an increase
Good evening, can i please get some help with these questions? i am struggling to answer them. thank you
- Explain the effect of an increase in imports (= an increase in marginal propensity to import) on the equilibrium GDP in the Keynesian income-expenditure model. In your answer, carefully show the new equilibrium and explain the adjustment to the new equilibrium.
- Carefully explain the effect of a $100 decrease in government transfers (subsidies for education, pensions etc.) on the equilibrium GDP in the Keynesian income- expenditure model. In your answer, carefully show the new equilibrium and explain the adjustment to the new equilibrium.
- Suppose the Central bank of a country issues additional money as cash (additional $100).
a) What will be the total change in money supply if all $100 are held as cash?
b)What will be the total change in money supply if all $100 are deposited in a commercial bank?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started