ECON 2400 Study Guide - Midterm Guide: Gdp Deflator, Autonomous Consumption, Canon Eos C300
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Gross investment = new houses+equipment and plant investment+change in inventories = 1750+1660-300=3110. 3110-950 = 2160: b. g=government consumption + government investment = 1560+1650=3210, c. y=c+i+g+nx. C=consumer non-durables+consumer durables + households spending on services =2450+1670+2900=7020. The real gdp, not the nominal gdp, measures the total quantities of goods and services produced in the economy of the economy, but not the general price level. Accounts includes all the household purchases of final goods and services, except the household purchases of new houses, which is included under private investment: a. Private savings equals y-t-c, which equals disposable income minus consumption: d. when public savings is positive, i. e. , t>g, the government is running a budget surplus. National savings s=y-c-g will therefore decrease as c increases. As i=s in equilibrium, investment spending also decreases: d. in the classical model, reduction in taxes ( t<0) will lead to an increase in disposable income (y-t) by the same amount.
