Think of a macroeconomy described by the following: ; , , ; , where is the national income or GNP, is the consumption function, is the tax function, and are investment and government expenditures respectively, and refers to net exports. Then, the equilibrium value of government deficit/ surplus will be:
Tap an option to check your answer.
Checking your account…
Think of a macroeconomy described by the following: C = 200 + 0.5(Y - T); T = 100 + 0.2Y, NX = 150 - 0.2Y, I = 300; G = 400, where Y is the national income or GNP, C is the consumption function, T is the tax function, I and G are investment and government expenditures respectively, and NX refers to net exports. Then, the equilibrium value of government deficit/ surplus will be: (A) a deficit of 50. (B) a surplus of 50. (C) a deficit of 125. (D) a surplus of 75.
Keynesian cross and the multiplier has come up 167 times in 7 exams since 2006.
This question is on Keynesian cross equilibrium, part of Keynesian cross and the multiplier in Macroeconomics.
How income is determined when output adjusts to planned spending, and what happens to unplanned inventories.
TestStop has 35 past-paper questions on this subtopic; the nearest in year are below.
Question from the JNU SIS 2021 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.