Macroeconomics Answers

Using the simple Keynesian (J-W) model to assess the implications for equilibrium GDP and the level of savings of an increase in the savings function. What happens to the level of savings? What would happen to equilibrium income if there is a sustained rise in private investment spending?

Suppose the banking system currently has $400 billion in reserves, the reserve requirement is 10 percent, and excess reserves are $3 billion. What is the level of loans?
a. $3,603 billion
b. $3,600 billion
c. $3,573 billion
d. $3,570 billion

My professor already told us that the answer is d. but i cant figure out twhat to do to get the answer.

what is investment?
how its related to national savings and national income?

I have a little question: After the events in Syria ... Syrian economy will rise after the fall of Assad, despite the devastation in this country?? And if yes how long??

Q1b
Assume the aggregate supply relationship (between output and the price level) in a particular economy takes the following form, where all variables are represented as logs;
EQU-1' is; y2 = c - d (w - p)
where y2= level of output, p= price level, c & d are positive constants (i.e. c>0, d>0) w is the fixed value of the nominal wage and where c<dw.
Further assume that aggregate demand is determined as follows and subject to influence by fiscal & monetary policies as described by the following equation;
EQU-2' is; yd = e + a1,jg + a12 (m - p);
where yd is the level of aggregate demand, g represents the setting of government spending, m is the setting of nominal money supply, e is a positive (i.e. e>0), a1,j (where j=1,2) are coefficients indicating the input of each policy instrument on aggregate demand, and a1,j > 0 (where j=1,2)
The question is; using EQU-1 & EQU-2 above to solve for equilibrium values of p & y in terms of the settings of g and m, the a ('subscript' 1,j) and the other model

Assume that the country is in a period of high unemployment, interest rates are at almost zero, inflation is about 2% per year, and GDP growth is less than 2% per year. Suggest how fiscal and monetary policy can move those numbers to an acceptable level keeping inflation the same. What is the first action you would take as the president? As the chairman of the Fed? Why? What would be your subsequent steps? Make sure you include both the positive and negative effects of your actions and include the trade-offs or opportunity costs.
Include the following concepts in your discussion:
• Demand and supply of money
• Income and Productivity
• Interest rates
• Okun’s law
• The Phillips curve
• Taxation
• Government spending
• Wages
• Aggregate supply
• Aggregate demand
• Long run and short run
• Costs of inflation
• The multiplier and the tax multiplier
• An open vs. a closed economy
• The idea of tax rebates to stimulate the economy
Part 2: Assume the country is in a budget deficit and carrying a very large debt. Discuss the dangers of a high debt to GDP ratio and a growing budget deficit. Would this change any policy changes

What were the key differences Between Keynes theory of income determination and that of the classical economists? Why did Keynes think that the market system could break down?