G equals all planned federal government spending.|I equals planned spending on new capital items.|T equates to all planned receipts from taxes.|C is less than disposable earnings minus planned conserving. |" type="hidden">

Concern 3

Suppose that one month, injections in a four-sector economic situation are higher than withdrawals. Which of the following statements is false?


Question 4

Suppose we draw the intake function for a two-sector economic climate, through disposable income, YDIS, on the horizontal axis and also planned usage, C, on the vertical axis. Suppose we additionally add a 45° line with the beginning, and uncover that the usage attribute intersects this at a YDIS equal to £1,000 billion a year. Which of the complying with statements is false?


a) The slope of the intake attribute at any level of YDIS mirrors the value of MPCDIS at that level of YDIS.

You are watching: Which of the following statements is correct for a private closed economy?


b) If YDIS in the economic climate was £1,000 billion a year, planned customer spending would likewise equal £1,000 billion a year.
YDIS mirrors the value of MPCDIS at that level of YDIS.|If YDIS in the economic climate was £1,000 billion a year, planned customer spfinishing would certainly also equal £1,000 billion a year.|If YDIS in the economy was less than £1,000 billion a year, planned conserving would certainly be negative.|The intake attribute should be a right line.|" type="hidden">

Concern 5

Which of the complying with components might reason a country"s usage function to transition upwards?


Question 6

Consider a two-sector economic climate. Output has settled in equilibrium at the level wright here the injections line, J, intersects the withdrawals line, W. Which of the complying with statements is false?


W downwards.|An boost in induced intake would make the W line flast.|An increase in injections will certainly transition the J line upwards.|If either line shifts upwards, the equilibrium level of output will rise.|" type="hidden">

Inquiry 7

In a four-sector economic climate, which of the adhering to is assumed constantly to rise once GDP increases?


Question 9

Suppose the government boosts the taxes on tobacco commodities, and expect the demand for these commodities is inelastic. How must this be analyzed on the multiplier model? Which of the adhering to statements is true?


a) The planned expenditure line will certainly transition upwards, because civilization will pay more in the shops on tobacco assets.
b) The planned expenditure line will certainly transition downwards, because civilization will buy fewer cigarettes, so their spending on tobacco after permitting for the tax will be lower.
c) The withdrawals line will certainly finish up moving downwards, because the rise in the tax will cause human being to conserve much less.
d) The injections line will certainly change downwards, bereason this includes all government spfinishing net of taxes.

See more: The Art Of Talking To Anyone By Rosalie Maggio, The Art Of Talking To Anyone 4+


d) The balanced budobtain multiplier means that if the government boosts its taxes and purchases by the exact same amount, output could still increase.
MPEY).|The multiplier in a four sector economic climate amounts to 1/(MPSY).|The size of the multiplier rises if the W line becomes flatter.|The balanced budobtain multiplier indicates that if the federal government rises its taxes and also purchases by the exact same amount, output could still boost.|" type="hidden">
*

About the book

Find out even more, check out a sample chapter, or order an inspection copy if you are a lecturer, from the Higher Education website