Macroeconomics Answers

Consider An Economy In Which The Consumption Function Takes The Following Simple Algebraic Form: C = 300+0.75DI And In Which Investment (I) Is Always $900 And Net Exports Are Always -$100. Government Purchases Are Fixed At $1,300 And Taxes Are Fixed At $1,200. Find The Equilibrium Level Of GDP.

In the economy of Keynesian Island, autonomous consumption expenditure is $50 million, and the marginal propensity to consume is 0.8. Investment is $160 million, government expenditure is $190 million, and net taxes are $250 million. Investment, government purchases, and taxes are constant—they do not vary with income. The island does not trade with the rest of the world.
a) Draw the aggregate expenditure curve. (5 marks)
b) What is equilibrium real GDP for Keynesian Island? (6 marks)
c) What is the size of the multiplier in Keynesian Island's economy? (4 marks)
d) If the government increases its purchases by $200 million, what will be the change in the economy's equilibrium real GDP? Show the change on the graph as well.

In the Namibian economy, the commercial banks have deposits of N$600 billion. Their reserves are N$60 billion. All reserves are in deposits with the Bank of Namibia and the commercial banks hold no excess reserves. There is N$120 billion in Bank of Namibia, notes outside the banks, and there are no coins.
a) What is the economy's monetary base? (5 marks)
b) What is the quantity of money in the economy? (5 marks)
c) Calculate the money multiplier. (5 marks)
d) Suppose the Bank of Namibia undertakes an open market purchase of securities of so that the monetary base increases by $5 billion. By how much will the quantity of money change?

A country with a civilian population of 120, 000 (all over age 16) has 100,000 employed and 10, 000 unemployed persons, of which 5, 000 are frictionally unemployed and another 3, 000 structurally unemployed. Given the above data, complete the following questions. Show the work.
1. What is the size of the labor force?
2. What is the actual unemployment rate?
What is the labor force participation rate?
4. What is the employment-population ratio?
5. What is the natural rate of unemployment?

assuming a classical model, goernment decides to increase the marginal income tax rate(PAYE). how would this change affect output, employment, and the price level? consider two cases, case one in which the increased revenue produced by the tax increase results in a decline in bond sales t the public, and a second case when it results in lower money creation.

what are the major policy conclusions of classical economics?

When inflation rises

Q.1 There is a country called Ecobliss. The economy consisted of 2 goods: A&B.This country is self suffiecient with no exports or imports. In 2019, the economy produced 20A and 50B. The prices (given here in the local currency rupiya) were 12 and 30 rupiya, respectively.
During the next year, the citizens of Ecobliss get struck by a deadly virus which induced extreme drowsiness in its victims. Productivity is hit hard due to this. In 2020 , the economy produce 15A at 15 rupiya each and 30B costing 32 rupiya each.
a.) Find the following information for 2019&2020.
Nominal GDP Real GDP(in 2019 prices)
GDP deflator (in 2019 prices)
Real GDP(in 2020 prices)
GDP deflator (in 2020 prices)
b) What is the rate of inflation between 2019 & 2020 using 2019 as a base year ?
c) What is the percentage change in the GDP deflator between 2019 &2020 using 2020 as the base year?
d) Why are your answers to b) and c) different

Suppose inflation expectations of individuals increase by one percentage point for every five percent increase in the current price level of apples. Further assume that real money demand of individuals decreases by one percent for every two percentage point increase in nominal interest rate. Then, what should be the increase in nominal wage rate in long run with a sudden ten percent increase in money supply?

Need clear and mathematical economic answer