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    GDP/Equilibrium and MPC

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    GDP/Equilibrium and MPC questions:

    C = 250 Billion +. 80GDP

    Please use equation above for following questions:

    1. If the planned investment is $200 billion, the equilibrium level of GDP is:

    2. If the equilibrium is $2000 billion, autonomous investment is:

    C = $100 + .80 (GDP); I = $20

    Please use equation above to answer questions below.

    3. Private sector equilibrium occurs at GDP of:

    4. The equation for private sector equilibrium can be expressed as:

    5. What is the value of the marginal propensity to consume?

    6. What is the value of the multiplier

    7. If planned investment increases by $10, by how much will equilibrium GDP increase?

    8. The new equilibrium GDP after the $10 increase in investment is:

    9. Assume government decided to spend $30. Equilibrium GDP at investment of $30 and government spending of $30 is:

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    Solution Summary

    What is the value of the marginal propensity to consume?