Macroeconomics Answers

Congress just passed close to a $2 Trillion dollar increase in government spending that will be funded by borrowing and going into debt: 

How will this impact U.S. national savings, investment, capital per worker, output per worker and the steady state in Solow’s Growth Model. Make sure to include an intuitive and graphical analysis as well as the policy recommendations in Solow’s growth model.  

Draw Solow's growth model

Investment expenditure = 56 Government expenditure = 50 Autonomous Consumption = 100 Net exports = (30) MPS = 0.44. Required: i. Find the consumption and savings functions and indicate your assumptions of the model used. 4mks ii. Find the equilibrium level of national income 4m

Derive the Equation of Motion for Solow growth Model and discuss the break-even level of investment.

Derive the general case of the Endogenous Growth model and discuss the dynamics for both K and A given β + θ > 1 and β +θ = 1.

1)Show the equilibrium of SI and LM graphically and numerically?

2)Show the changes in the graph of;

• a decrease in government spending

• an increase Tax

3) Explain graphically the monetary policy change in the equilibrium IS and ML

4)What are the reasons of factor that shift both IS and ML curves

5)write down the shift factors of fiscal and monetary policy?

If C=100+0.75Y

T=50+0.5Y

X=200

M=50+0.25Y

G=150

Determine the equilibrium level of output

Everyone is affected in some way by macroeconomic issues such as inflation and unemployment, public provision of goods and free market constraints. Keeping this in view how you evaluate the study we did in ten principals of Economics. Please describe how it is helpful in understanding economic decision making. 

If Ernest Rutherford died and left $8000 to be invested for a period of 100 years to benefit medical students and scientific research, how often would this money double if it were to earn 5 percent per year for all years?

a. every 10 years

b. every 14 years

c. every seven years

d. every five years

How might federal deficits crowd out private domestic investment? How could this affect future living standards? 

Suppose events in the rest of the world cause the exchange rate to fall when the U.S. economy is at full employment. How should U.S. government react in order to maintain macroeconomic stability? Why?

Walderland is a fictitious country where the local currency is called waldis. At present, the  currency held by the public is 500,000 waldis, bank reserves are 500,000 waldis, and the required  reserve-deposit ratio is 0.10. Assume throughout the problem that the public does not wish to change  the amount of currency they hold. The central bank in Walderland conducts an open market sale of  200,000 waldis. What is the new money supply?