Answer the Following Questions Using the Aggregate Expenditures Model of the Economy

question 44

Essay

Answer the following questions using the aggregate expenditures model of the economy described below.C = 80 + .6Yd
T = 40 + .2Y
Ia = 28
Ga = 64
Xa = 76
M = .18Y
(a) What are the marginal propensity to consume, the marginal tax rate, and the marginal propensity to import?
(b) What is the saving function? What is the marginal propensity to save?
(c) What is the aggregate expenditure function? What is autonomous expenditure? What is the marginal propensity to withdraw?
(d) What is the equilibrium level of real GDP?
(e) What is the size of the multiplier?
(f) Suppose the full employment level of real GDP is $340.Does a recessionary gap or an inflationary gap exist? How can the government eliminate the gap by altering government expenditures?

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Peer Group

Is composed of people who are about the same age and of similar status as the individual. The peer group acts as an agent of socialization.

Similar Status

A situation where individuals or groups hold equivalent positions in terms of social hierarchy, prestige, wealth, or education within a society.

Statistical Category

A classification based on numerical or quantitative data used for analysis and interpretation purposes.

Resocialization

The process by which one's social values and norms are restructured, often in a new, different environment.