The Total Expenditure Schedule in Macroland Begins with These Initial

question 184

Essay

The total expenditure schedule in Macroland begins with these initial levels (in billions of dollars): Income = 1,000; Consumption = 900; Investment = 200; Government = 300; Net Exports = −100.If the MPC = 0.75 and income increases in increments of 200, find the equilibrium level of income.If full employment requires an income level of 2,000, what (if anything) should the government do? Indicate both the direction of the spending change and the size of the spending change.

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Definitions:

Private Liberty

The concept and state of being free from government intrusion or control in one's personal life, choices, and property.

Final Constitution

The ultimate legal document that outlines the fundamental principles by which a state or organization is governed, following any amendments or revisions.

Anti-Federalists

A group of individuals in early American history who opposed the creation of a stronger U.S. federal government and were against the ratification of the 1787 Constitution in favor of smaller, decentralized government entities.

Liberty

The quality or state of being free from oppressive restrictions imposed by authority on one's way of life, behavior, or political views.