{"id":12309,"date":"2022-04-13T00:02:55","date_gmt":"2022-04-13T00:02:55","guid":{"rendered":"https:\/\/courses.lumenlearning.com\/wm-macroeconomics\/?post_type=chapter&p=12309"},"modified":"2024-09-11T16:41:40","modified_gmt":"2024-09-11T16:41:40","slug":"module-10-assignment-problem-set-the-income-expenditure-model","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/wm-macroeconomics\/chapter\/module-10-assignment-problem-set-the-income-expenditure-model\/","title":{"raw":"Module 10 Assignment: Problem Set \u2014 The Income-Expenditure Model","rendered":"Module 10 Assignment: Problem Set \u2014 The Income-Expenditure Model"},"content":{"raw":"You can click on the following link to download the problem set for this module: The Income-Expenditure Problem Set.<\/a>\r\n

The Income-Expenditure Model Problem Set[1]<\/strong><\/a><\/sup><\/h2>\r\n
    \r\n \t
  1. Consider the following information in the table below.<\/li>\r\n<\/ol>\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n
    Income (Y)<\/td>\r\nConsumption (C)<\/td>\r\nSavings (S)<\/td>\r\n<\/tr>\r\n
    1000<\/td>\r\n950<\/td>\r\n50<\/td>\r\n<\/tr>\r\n
    1100<\/td>\r\n1040<\/td>\r\n60<\/td>\r\n<\/tr>\r\n
    1200<\/td>\r\n1130<\/td>\r\n70<\/td>\r\n<\/tr>\r\n
    1300<\/td>\r\n1220<\/td>\r\n80<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\nGiven this data the consumption function can be written as:\r\n\r\nC = _____ + _____ Y\u00a0<\/strong>\r\n
      \r\n \t
    1. Consider the following information for Slovenia.<\/li>\r\n<\/ol>\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n
      Category<\/td>\r\nAmount<\/td>\r\n<\/tr>\r\n
      Autonomous Consumption<\/strong><\/td>\r\n250<\/td>\r\n<\/tr>\r\n
      MPC<\/strong><\/td>\r\n0.9<\/td>\r\n<\/tr>\r\n
      Tax Rate<\/strong><\/td>\r\n0.25<\/td>\r\n<\/tr>\r\n
      Investment<\/strong><\/td>\r\n800<\/td>\r\n<\/tr>\r\n
      Government Expenditure<\/strong><\/td>\r\n100<\/td>\r\n<\/tr>\r\n
      Exports<\/strong><\/td>\r\n20<\/td>\r\n<\/tr>\r\n
      MPI<\/strong><\/td>\r\n0.05<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\nWhat is the equilibrium level of GDP in the income-expenditure model?\r\n
        \r\n \t
      1. Consider the following information in the table below.<\/li>\r\n<\/ol>\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n
        Income (Y)<\/td>\r\nImports (M)<\/td>\r\n<\/tr>\r\n
        1000<\/td>\r\n200<\/td>\r\n<\/tr>\r\n
        1100<\/td>\r\n220<\/td>\r\n<\/tr>\r\n
        1200<\/td>\r\n240<\/td>\r\n<\/tr>\r\n
        1300<\/td>\r\n260<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\nGiven this data, what is Marginal Propensity to Import (MPI)?\r\n\r\n\u00a0<\/strong>\r\n
          \r\n \t
        1. Suppose that the level of income is $1000 and the tax rate is 0.1 %.<\/li>\r\n<\/ol>\r\nGiven this data, what is the level of disposable income?\r\n\r\n \r\n

          Use the following information to answer questions 5 through 8:<\/h3>\r\nConsider the following information for Slovenia.\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n
          Category<\/td>\r\nAmount<\/td>\r\n<\/tr>\r\n
          Autonomous Consumption<\/strong><\/td>\r\n430<\/td>\r\n<\/tr>\r\n
          MPC<\/strong><\/td>\r\n0.9<\/td>\r\n<\/tr>\r\n
          Tax Rate<\/strong><\/td>\r\n0.25<\/td>\r\n<\/tr>\r\n
          Investment<\/strong><\/td>\r\n800<\/td>\r\n<\/tr>\r\n
          Government Expenditure<\/strong><\/td>\r\n100<\/td>\r\n<\/tr>\r\n
          Exports<\/strong><\/td>\r\n20<\/td>\r\n<\/tr>\r\n
          MPI<\/strong><\/td>\r\n0.05<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n \r\n
            \r\n \t
          1. What is the equilibrium level of GDP in the income-expenditure model?<\/li>\r\n<\/ol>\r\n \r\n
              \r\n \t
            1. Suppose that there is a decrease in Exports by $20. What is the new equilibrium level of GDP in the income-expenditure model?<\/li>\r\n<\/ol>\r\n \r\n
                \r\n \t
              1. What is the difference between the original and new GDP as a result of a decrease in Exports?<\/li>\r\n<\/ol>\r\n \r\n
                  \r\n \t
                1. Suppose that MPC is equal to 0.8. What is the spending multiplier?<\/li>\r\n<\/ol>\r\n \r\n
                  \r\n\r\n \r\n\r\n
                  \r\n\r\n[1]<\/a> This assignment by Lumen Learning is licensed under a Creative Commons Attribution 4.0 International License. You can access an alternative means to plotting points at https:\/\/www.desmos.com\/calculator<\/a>.\r\n\r\nYou can click on the following link to download the problem set for this module: The Income-Expenditure Problem Set.<\/a>\r\n\r\n<\/div>","rendered":"

                  You can click on the following link to download the problem set for this module: The Income-Expenditure Problem Set.<\/a><\/p>\n

                  The Income-Expenditure Model Problem Set[1]<\/strong><\/a><\/sup><\/h2>\n
                    \n
                  1. Consider the following information in the table below.<\/li>\n<\/ol>\n\n\n\n\n\n\n\n
                    Income (Y)<\/td>\nConsumption (C)<\/td>\nSavings (S)<\/td>\n<\/tr>\n
                    1000<\/td>\n950<\/td>\n50<\/td>\n<\/tr>\n
                    1100<\/td>\n1040<\/td>\n60<\/td>\n<\/tr>\n
                    1200<\/td>\n1130<\/td>\n70<\/td>\n<\/tr>\n
                    1300<\/td>\n1220<\/td>\n80<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

                    Given this data the consumption function can be written as:<\/p>\n

                    C = _____ + _____ Y\u00a0<\/strong><\/p>\n

                      \n
                    1. Consider the following information for Slovenia.<\/li>\n<\/ol>\n\n\n\n\n\n\n\n\n\n\n
                      Category<\/td>\nAmount<\/td>\n<\/tr>\n
                      Autonomous Consumption<\/strong><\/td>\n250<\/td>\n<\/tr>\n
                      MPC<\/strong><\/td>\n0.9<\/td>\n<\/tr>\n
                      Tax Rate<\/strong><\/td>\n0.25<\/td>\n<\/tr>\n
                      Investment<\/strong><\/td>\n800<\/td>\n<\/tr>\n
                      Government Expenditure<\/strong><\/td>\n100<\/td>\n<\/tr>\n
                      Exports<\/strong><\/td>\n20<\/td>\n<\/tr>\n
                      MPI<\/strong><\/td>\n0.05<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

                      What is the equilibrium level of GDP in the income-expenditure model?<\/p>\n

                        \n
                      1. Consider the following information in the table below.<\/li>\n<\/ol>\n\n\n\n\n\n\n\n
                        Income (Y)<\/td>\nImports (M)<\/td>\n<\/tr>\n
                        1000<\/td>\n200<\/td>\n<\/tr>\n
                        1100<\/td>\n220<\/td>\n<\/tr>\n
                        1200<\/td>\n240<\/td>\n<\/tr>\n
                        1300<\/td>\n260<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

                        Given this data, what is Marginal Propensity to Import (MPI)?<\/p>\n

                        \u00a0<\/strong><\/p>\n

                          \n
                        1. Suppose that the level of income is $1000 and the tax rate is 0.1 %.<\/li>\n<\/ol>\n

                          Given this data, what is the level of disposable income?<\/p>\n

                           <\/p>\n

                          Use the following information to answer questions 5 through 8:<\/h3>\n

                          Consider the following information for Slovenia.<\/p>\n\n\n\n\n\n\n\n\n\n\n
                          Category<\/td>\nAmount<\/td>\n<\/tr>\n
                          Autonomous Consumption<\/strong><\/td>\n430<\/td>\n<\/tr>\n
                          MPC<\/strong><\/td>\n0.9<\/td>\n<\/tr>\n
                          Tax Rate<\/strong><\/td>\n0.25<\/td>\n<\/tr>\n
                          Investment<\/strong><\/td>\n800<\/td>\n<\/tr>\n
                          Government Expenditure<\/strong><\/td>\n100<\/td>\n<\/tr>\n
                          Exports<\/strong><\/td>\n20<\/td>\n<\/tr>\n
                          MPI<\/strong><\/td>\n0.05<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

                           <\/p>\n

                            \n
                          1. What is the equilibrium level of GDP in the income-expenditure model?<\/li>\n<\/ol>\n

                             <\/p>\n

                              \n
                            1. Suppose that there is a decrease in Exports by $20. What is the new equilibrium level of GDP in the income-expenditure model?<\/li>\n<\/ol>\n

                               <\/p>\n

                                \n
                              1. What is the difference between the original and new GDP as a result of a decrease in Exports?<\/li>\n<\/ol>\n

                                 <\/p>\n

                                  \n
                                1. Suppose that MPC is equal to 0.8. What is the spending multiplier?<\/li>\n<\/ol>\n

                                   <\/p>\n

                                  \n

                                   <\/p>\n

                                  \n

                                  [1]<\/a> This assignment by Lumen Learning is licensed under a Creative Commons Attribution 4.0 International License. You can access an alternative means to plotting points at https:\/\/www.desmos.com\/calculator<\/a>.<\/p>\n

                                  You can click on the following link to download the problem set for this module: The Income-Expenditure Problem Set.<\/a><\/p>\n<\/div>\n\n\t\t\t

                                  \n\t\t\t

                                  Candela Citations<\/h3>\n\t\t\t\t\t
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                                  CC licensed content, Original<\/div>