Use the following table to answer the question below for an economy that has a government and trades with other countries. Allnumbers are in billions.Level of OutputConsumption InvestmentGovernment Net ExportsPurchases$240$244$4$6$2$260$260$4$6$2$280$276$4$6$2$300$292$4$6$2$320$308$4$6$2$340$324$4$6$2$360$340$4$6$2$380$356$4$6$2$400$372$4$6$2The equilibrium level of GDP (output) will be:O a) $360b)$320c) $260d) $280

solution : correct answer is option b $320 explanation for the equilibrium GDP following equation…

Answered: Use the following table to answer the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Similar questions

If national income Y = 10,500, disposable income Yd = 8,500 , consumption is C = 8,000, transfer payments TR = 150 and the budget deficit is BD = 200, what is the level of private domestic investment, I ? (please insert the round number without the Euro symbol)
Table 2 shows the elements of national income accounts of a country. The economy is in equilibrium. Accounts Consumption (total) Investment Government Expenditures Imports Exports £bn 80 12 8 10 16 A) What is the current equilibrium value of national income? B) What are the levels of injections and withdrawls? C) Assume that the national income rises to £108 bn and the consumption of the domestically produced goods rises to £72 bn. What is the marginal propensity to consume (use 2 decimal places)? D) What is the multiplier for this economy? E) Comment on the results in part c) ad d).
Use the following terms for this question: C = Consumption. I = Capital investment spending. G = Government spending. X = Exports of goods and services. M = Imports of goods and services. BOP = Balance of Payments. GDP = Gross Domestic Product. NPV = Net Present Value. INF = Inflation. R = Real rate of return. The static equation for a country’s GDP is: A. GDP = C + I + G + X – M - (R – INF). B. GDP = C + I + G + X + M. C. GDP = C + I + G + X – M. D. GDP = C + I + X - M + R – INF.
Assume the following to be a portion of the simplified balance of payments statement for a hypothetical country. The values are given in billions of dollars. Exports Imports Capital Outflows Capital Inflows $900 - $675 - $225 $135 If the central bank has not changed its holding of foreign-currency reserves during this period, then the capital-service account for this country should be equal to billion.
2. Imports and ExportsNow we allow for international trade. Use the following information from problem 1: C = 400 + (8/9)*DI I = 300G = 800T = (1/2)*Y. Suppose that exports are constant at X = 300.Let imports be a fraction of real income: M = (1/9) * Y. a. Give intuition for why imports M are positively related to national income Y in the equation above.b. Suppose that national income increases by $1. How much will spending on imports increase (the marginal propensity to import) in this case? c. Compute the equilibrium level of national income under international trade. d. Suppose that government spending increases by $120. i) Compute the new equilibrium national income. ii) Based on your numerical answer to (i), calculate the change in national income from a one dollar increase in government spending. iii) Derive the new fiscal multiplier from an increase in government spending using an algebraic equation. Compare to Problem 2.d.(ii). Compare to Problem 1.c.(v).e. Trade…
Suppose you work at the FOREX desk of a multinational bank. No particular country is the home country for you as your responsibility is to conduct foreign exchange trade in whichever way is profitable for the bank. Using this as your guideline, consider the following data: S0 = ¥92/US$ S180 = ¥92/US$ IUS = 2% per annum IJapan = 0.09% per annum With a starting amount of US$10 million or its Yen equivalent, can you make a UIA profit? What if a CIA was conducted at F180 of ¥90/US$? What are your observations?
2.) Pound 0.64/$ in London, 1.04/Euro in New York, and Pound 0.64/Euro in Frankfurt. Depending on this information, how do you think you can make a profit by trading currency in the given monetary centers? calculate your profit by explaining transactions
What information would one use to determine the type of economic system that a country has? (Multiple choice) 1. The information needed would be the rate of inflation and the gross domestic product figures. 2. The information needed would be the breakdown on who owns the business in the country and how much control the government has upon business regulations, taxes, etc. 3. The information needed would be the gross domestic products figures and consumer price index figures.
AMg eru w Question The economy records the following transactions: . Imports of goods and services: $1569 billion Exports of goods and services: $1152 billion . Interest paid to the rest of the world: $500 billion Interest received from the rest of the world: $400 billion . US official reserves, -$10 billion Net Transfers: -$81 billion Investment in US from foreigners: $1440 . US investment abroad: $860 a. Calculate the Current Account balance, the Financial Account (Capital ACcount) balance: (No Dollar symbols) CA Balance: (hint: answer is negative) FA Balance: b. What is the statistical discrepancy? c. Is this country an 'Importer' or 'Exporter' of goods and services?
Use the Mundell-Fleming model with perfect capital mobility, for each economy, analyze why the effectiveness of monetary, fiscal, and trade policies depend on the exchange rate regime in place in a country.
Considering the following quotes from three banks: London Bank: €1.0837/£ Hong Kong Bank: U$1.1944/£ Tokyo Bank: €0.9582/U$ Ignoring transaction costs, is there an arbitrage opportunity based on these quotes? Justify your answer through calculations. If yes, what steps would you take to make an arbitrage profit and how much profit in US dollars would you make if you are authorized to use 10 million US dollars for this purpose?
SMEs plays an important role in a country’s economic development because a. SMEs contribute to the GDP b. SMEs expect more support from the government c. SMEs reduce production within a country d. SMEs creates problem on government finances

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