Consider the following data for a closed economy:
a. Y = 12 trillion
b. C = 8 trillion
c. I = 3 trillion
d. TR = 2 trillion
e.
T = 3 trillion
Use the data provided to calculate the level of private saving and the level of public saving and demonstrate their relationship to investment.
Ques. 2An optimal two-part tariff pricing schedule maximizes consumer surplus.
Indicate whether the statement is true or false
Ques. 3Refer to Table 25-1. Suppose a transaction changes a bank's balance sheet as indicated in the T-account, and the required reserve ratio is 10 percent. As a result of the transaction, the bank has excess reserves of
A) 0. B) 400. C) 3,600. D) 4,000.
Table 25-2
Assets Liabilities
Reserves +8,000 Deposits + 8,000
Ques. 4Explain how each of the following events would affect the short-run aggregate supply curve.
a. A decrease in the price level
b. A decrease in what the price level is expected to be in the future
c. A price level that is currently lower than expected
d. An unexpected decrease in the price of an important raw material
e. A decrease in the labor force
Ques. 5The marginal propensity to consume measures the average amount of wealth that a consumer spends in a given period of time.
Indicate whether the statement is true or false
Ques. 6A two-part tariff refers to a pricing schedule under which a buyer must pay a fixed fee for the right to purchase the product, in addition to a per-unit price.
Indicate whether the statement is true or false
Ques. 7What impact does monetary policy have on the long-run Phillips curve?
A) Monetary policy shifts the long-run Phillips curve to the right or left, depending on whether monetary policy is expansionary or contractionary.
B) Monetary policy can only shift the long-run Phillips curve to the right.
C) Monetary policy can only shift the long-run Phillips curve to the left.
D) Monetary policy has no impact on the long-run Phillips curve.
Ques. 8Using equations for public and private saving, show that saving must equal investment in a closed economy. Begin with the expression for total saving in the economy.
What will be an ideal response?
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