Imagine an economy in which Ricardian equivalence holds. This economy has a budget deficit of 50, a
Question:
Imagine an economy in which Ricardian equivalence holds. This economy has a budget deficit of 50, a trade deficit of 20, private savings of 130, and investment of 100. If the budget deficit rises to 70, how are the other terms in the national saving and investment identity affected?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 100% (3 reviews)
Ricardian equivalence means that private saving changes to of...View the full answer
Answered By
Milan Mondal
I am milan mondal have done my Msc in physics (special astrophysics and relativity) from the University of burdwan and Bed in physical science from the same University.
From 2018 I am working as pgt physics teacher in kendriya vidyalaya no2 kharagpur ,west bengal. And also I am doing advanced physics expert in chegg.com .also I teach Bsc physics .
I love to teach physics and acience.
If you give me a chance I will give my best to you.
5.00+
4+ Reviews
10+ Question Solved
Related Book For
Question Posted:
Students also viewed these Business questions
-
Assume an economy has a budget surplus of 1,000, private savings of 4,000, and investment of 5,000. a. Write out a national saving and investment identity for this economy. b. What will be the...
-
How would each of the following affect national saving, investment, the current account balance, and the real interest rate in a large open economy? a. An increase in the domestic willingness to save...
-
Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...
-
Jefferson Company purchased a piece of equipment on January 1, 2014. The equipment cost $60,000 and has an estimated life of 8 years and a salvage value of $8,000. What was the depreciation expense...
-
Bruno Company budgeted selling expenses of $30,000 in January, $35,000 in February, and $40,000 in March. Actual selling expenses were $31,000 in January, $34,500 in February, and $47,000 in March....
-
Given: E(R1) = 0:12 E(R2) = 0:16 E(1) = 0:04 E(2) = 0:06 Calculate the expected returns and expected standard deviations of a two-stock portfolio having a correlation coefficient of 0.70 under the...
-
Smith & Co, experienced the following six events in its first year of operations: 1. Shareholders contributed \($60,000\) cash. 2. Purchased land for \($40,000\) cash. 3. Borrowed \($18,000\) in cash...
-
Health-Temp Company is a placement agency for temporary nurses. It serves hospitals and clinics throughout the metropolitan area. Health-Temp Company believes it will place temporary nurses for a...
-
Oliver Williamson said two main corporate governance advantages of the multidivisional structure ("M-form") for large, diversified companies were: Question 1Answer a. Allowing decision-making to be...
-
Why have many education experts recently placed an emphasis on altering the incentives that U.S. schools face rather than on increasing their budgets? Without endorsing any of these proposals as...
-
In the late 1990s, the U.S. government moved from a budget deficit to a budget surplus and the trade deficit in the U.S. economy grew substantially. Using the national saving and investment identity,...
-
Consider the following reference state conditions: the entropy of real saturated liquid methane at 100C is to be taken as 100 kJ/k mol K, and the entropy of hypothetical ideal gas...
-
Jay drove to his job by himselfevery weekday. On this particular Monday morning, he arrived in his office parking lot a few minutes before nine o'clock. He had several thoughts on his mind and was...
-
Before the mid-1960s, mentally disabled people were often institutionalized. The deinstitutionalization movement of the 1960s and 70s, resulted in an unintended result: the criminalization and...
-
Alex (A) and his brother Richard (R) have been home-builders for forty years. One day their solicitor suggests that they set up a family trust to "make their lives better." They agree. The trust...
-
Find the currents in the circuit shown below. Use Kirchhoff's rules to construct your system of equations for the unknown currents and solve. (Note: is the symbol for a resistor in this document)...
-
While visiting a playground, you see a child riding on a merry-go-round, which is a large metal disk which is parallel to the ground and can spin around its center. The merry-go-round has handrails,...
-
A variable of two populations has a mean of 40 and a standard deviation of 12 for one of the populations and a mean of 40 and a standard deviation of 6 for the other population. a. For independent...
-
At Glass Company, materials are added at the beginning of the process and conversion costs are added uniformly. Work in process, beginning: Number of units Transferred - in costs Direct materials...
-
What is the importance of the ability to effectively manage both the task requirements and the process or maintenance aspects of the group for them to function well?
-
Why is knowledge of role relationships important for managers?
-
What purposes are served by status differentiations in work organizations? What problems emerge from these differentiations?
-
Complete the table to determine the effect of the number of compounding periods when computing interest. Suppose that $13,000 is invested at 3.7% interest for 14 yr under the following compounding...
-
A three year lease is entered into with the following terms: (Lesson 8.3) Economic life of asset is 6 years. Lease payments, made at beginning of the lease terms are $34,972.24. Fair value of asset...
-
A stock has had the following year-end prices and dividends: Year Price Dividend 1 $43.33 2 48.31 $0.54 3 57.23 0.57 4 45.31 0.80 5 52.23 0.85 6 61.31 0.93 What are the arithmetic and geometric...
Study smarter with the SolutionInn App