Question 5 a) Let’s assume that the total investment (% of GDP) and saving rates are...

Question 5

a) Let’s assume that the total investment (% of GDP) and saving rates are the same for two hypothetical countries in Asia. Aruba had a 4% growth rate of average annual income per capita and Smalland had a 1% growth rate. Based on the economic concept/s you have learned, explain what would have caused the growth rates to be different? Diagram/s are required.

b) Due to high levels of inflation, the Central Bank in Country A decides to sell government bonds. Using the Phillips curve framework, explain and analyse how this will impact unemployment in the short run and long run. Diagram/s are required.

Expert Solution

Rahul Sunny answered 9 months ago

Question 5 a) Let’s assume that the total investment (% of GDP) and saving rates are...

Question 5 a) Let’s assume that the total investment (% of GDP) and saving rates are the same for two hypothetical countries in Asia. Aruba had a 4% growth rate of average annual income per capita and Smalland had a 1% growth rate. Based on the economic concept/s you have learned, explain what would have caused the growth rates to be different? Diagram/s are required. b) Due to high levels of inflation, the Central Bank in Country A decides to...

Question 5 a) Let’s assume that the total investment (% of GDP) and saving rates are...

Question 5 a) Let’s assume that the total investment (% of GDP) and saving rates are the same for two hypothetical countries in Asia. Aruba had a 4% growth rate of average annual income per capita and Smalland had a 1% growth rate. Based on the economic concept/s you have learned, explain what would have caused the growth rates to be different? Diagram/s are required. b) Due to high levels of inflation, the Central Bank in Country A decides...

The saving rate (gross domestic saving as a % of GDP) in Singapore, a small open economy, was 48% in 2017 while the investment rate (domestic investment as a % of GDP) was 25%.

Explain whether the given statement is true, false or uncertain. Start your answer by selecting one of the options – “True”, “False” or “Uncertain” and then provide arguments to justify your selection (be brief and concise and present your arguments in 100 or less words). You need to ensure your assumptions are clear, reasonable and explicit if making any.Question:The saving rate (gross domestic saving as a % of GDP) in Singapore, a small open economy, was 48% in 2017 while...

5. Saving and net flows of capital and goods In a closed economy, saving and investment...

5. Saving and net flows of capital and goods In a closed economy, saving and investment must be equal, but this is not the case in an open economy. In the following problem, you will explore how saving and investment are connected to the international flow of capital and goods in an economy. Before delving into the relationship between these various components of an economy, you will be asked to recall some relationships between aggregate variables that will be useful...

Suppose the economy is in equilibrium, and assume no government or foreign sector. If total saving...

Suppose the economy is in equilibrium, and assume no government or foreign sector. If total saving equals 72420, then intended investment must equal... Question 6 options: Suppose a closed economy with no government spending or taxing is capable of producing an output of $3,000 at full employment. Suppose also that autonomous consumption is $400, intended investment is $200, and on average households will save 25 cents of every additional dollar of income they receive. Calculate the following (express your answers...

5. Graph the following and the effects of the following on national saving, investment, and the...

5. Graph the following and the effects of the following on national saving, investment, and the real interest rate. Explain your reasoning: a. Millennials need avocado toast today and society become less future-oriented and thus decide to save less. b. The government announces a large, one-time bonus payment to veterans returning from a war. The bonus will be financed by additional taxes levied on the general population over the next five years. c. AOC’s green plan passes and the expected...

1. Let’s look at Canada. Assume an equilibrium where Aggregate Expenditure is $1,350 billion and Real GDP in...

1. Let’s look at Canada. Assume an equilibrium where Aggregate Expenditure is $1,350 billion and Real GDP in $1,350 billion. (a) If Real GDP grew to 1,600, but AE only grew to 1,550 what is the marginal propensity to consume? 0.8 (b) From the initial state of $1,350, what change in taxes (positive or negative and actual numeric value) would bring GDP to $1,200 billion?

Let’s assume you have a bag of balls (5 red and 5 black). You roll a...

Let’s assume you have a bag of balls (5 red and 5 black). You roll a six-sided dice and then select a ball from the bag. What is the probability you roll a five on the die and then select a red ball? You are playing blackjack with no other players (i.e. cards are dealt immediately with no one else receiving cards). What is the probability you get a K, Q, J, or 10 on the first card followed by...

Question 5. Related Rates and Optimization . . . . . . . . . ....

Question 5. Related Rates and Optimization . . . . . . . . . . . . . . . . . . . . . . . . . 17 points Please answer the following questions. You need to justify your answers. (a) Suppose that two variables x and y satisfy the equation 8x^2 +22y^2 = C for some constant C. Find dy/dx at (x, y) = (10, 5). (b) Find the point P on the line y...

Suppose GDP is €5 trillion, taxes are €1.5 million, private saving is €0.5 trillion and public...

Suppose GDP is €5 trillion, taxes are €1.5 million, private saving is €0.5 trillion and public saving is €0.2 trillion. Assuming the economy is closed, calculate consumption, government purchases, national saving and investment.

Question

Question 5 a) Let’s assume that the total investment (% of GDP) and saving rates are...

Solutions

Expert Solution

Related Solutions

Question 5 a) Let’s assume that the total investment (% of GDP) and saving rates are...

Question 5 a) Let’s assume that the total investment (% of GDP) and saving rates are...

The saving rate (gross domestic saving as a % of GDP) in Singapore, a small open economy, was 48% in 2017 while the investment rate (domestic investment as a % of GDP) was 25%.

5. Saving and net flows of capital and goods In a closed economy, saving and investment...

Suppose the economy is in equilibrium, and assume no government or foreign sector. If total saving...

5. Graph the following and the effects of the following on national saving, investment, and the...

1. Let’s look at Canada. Assume an equilibrium where Aggregate Expenditure is $1,350 billion and Real GDP in...

Let’s assume you have a bag of balls (5 red and 5 black). You roll a...

Question 5. Related Rates and Optimization . . . . . . . . . ....

Suppose GDP is €5 trillion, taxes are €1.5 million, private saving is €0.5 trillion and public...