Calculate MPC from the following data about an economy which is in equilibrium: National income=2000, Investment expenditure=100, Autonomous consumption expenditure=200
Answered Feb 05, 2023
`Y=C+I` `Y=(bar(C )+By)+I` `b(2000)=1700 [At equiilbrium S=I=100 2. 1-b=MPS=0.3` `b(1700)/(2000)=0.85` Hence, MPC=0.85
Y=C+I `Y=bar(C)+bY+I` `Y=bar(C)+bY+I` `5000=bar(C)100+0.8(5000)+800[MPS=0.2, MPC=0.8]` 5000=bar(C )+4000+800 bar(C )=5000-4800=200
Y=C+I `Y=bar(C)+bY+I` `Y=bar(C)+bY+I` `10000=100+9000+I` I=10000-9100 I=900
`S=-bar(C )+(1-b)Y` `100=-bar(C )+(0.3)500` `100=-bar(C )+150` `-50=-bar(C ) or bar(C )=50` Hence, Autonomous Consumption expenditure =50
`C=barC+bY` 8000=500+b(10,000) b(10,000)=7500 `b=(7500)/(10,000)=0.75` or MPC=0.75 We know that MPC + MPS =1 0.75+MPS=1 MPS=1-0.75
`Y = C +I` (at equilibrium ) or `Y = (barC + bY) +1` ` 1000 =100 + 0 .8(1000) +1" " (MPC = 1- MPS rArr 1- 0.2 =0.8)`...
Correct Answer - 25002500
Correct Answer - `16800,12800`
Correct Answer - 2000900
Given `MPC` to `MPS=3 :1` i.e. `MPC=0.75` and `MPS=0.25` `Delta Y=20,000-12,000=8,000` crore `DeltaY=DeltaI 1/(MPS)` `8,000=DeltaI 1/(0.25)` `=4 Delta I` `Delta I= Rs. 2,000` crore.
Correct Answer - ( investment Expenditure =50) Autonomous consumption expenditure =140) ( marginal propensity to consume =0.6)
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