Answer the Questions Below

question 26

Essay

Answer the questions below:
(A)Plot the line showing where income and spending are equal. What does the slope of this line equal?
(B)Using the information in the table below, plot the line showing the relationship between expenditure and income. What is the slope of this line? (C)Using the graphical approach and the information in the above table, show what happens to the spending balance if government expenditures increase by 9.
(D)Using the graphical approach and the information in the above table, show what happens to the spending balance if the MPC increases to 0.9.

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Definitions:

Observed Z Value

A statistic measured in a dataset to determine how many standard deviations an element is from the mean.

Sample Mean

The average value of a sample set of numbers, calculated by summing all observations and dividing by the number of observations.

Population Average

The mean of a particular characteristic (e.g., age, income) of all the individuals or elements in a defined population.

Standard Error

A statistical measure that quantifies the variability or dispersion of a sampling distribution, often used to estimate the accuracy of a sample mean compared to the population mean.