Question: (4C) Consider the following consumption function C (Y denotes income). 400+3Y2 C = 2 +Y (i) Express the marginal propensity to consume (MPC) in terms

(4C) Consider the following consumption function C (Y denotes income). 400+3Y2

C = 2 +Y (i) Express the marginal propensity to consume (MPC)

(4C) Consider the following consumption function C (Y denotes income). 400+3Y2 C = 2 +Y (i) Express the marginal propensity to consume (MPC) in terms of Y. In other words, derive C' (n). 3 marks (ii) Using the answer to (i), calculate the values of MPC and marginal propensity to save (MPS) when Y = 10. Express your answers up to two decimal points

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!

Q:

26. A division of Conoco-Phillips is involved in their periodic capital budgeting activity and the engineering and operations staffs have identifi ed ten divisible investments with cash fl ow...

Q:

1. Tie fiscal policy initiatives to budget deficits and surpluses. 2. Compute the multiplier if the MPC=0.4. Interpret the multiplier you just calculated 3. CONSIDER THE FOLLOWING CONSUMPTION...

Q:

1. Tie fiscal policy initiatives to budget deficits and surpluses. 2. Compute the multiplier if the MPC=0.4. Interpret the multiplier you just calculated 3. CONSIDER THE FOLLOWING CONSUMPTION...

Q:

Consider the following consumption function: El. c = so + can, keeping in mind that YD indicates disposable income. which can be allocated only between consumption needs and savings. Derive the...

Q:

Consider the following consumption function: El. c = so + can, keeping in mind that YD indicates disposable income. which can be allocated only between consumption needs and savings. Derive the...

Q:

Please see attachments The next three questions are based on the following exhibit showing data for an economy operating under the assumptions of the simple Keynesian model. That is, there is no...

Q:

1.By using the repeated substitution method, Solving the following system of equations, which is a model of price and quantity determination in a one-good, widget, market: Q d = 100 - 10 P + 2G...

Q:

1. Draw the 3X3 (3 agents and 3 markets) circular flow of the economy and explain the interactions between and among these? 2. What is Marginal Propensity to Consume (MPC)? If MPC is 0.7, what is the...

Q:

solve this please 1. Draw the 3X3 (3 agents and 3 markets) circular flow of the economy and explain the interactions between and among these? 2. What is Marginal Propensity to Consume (MPC)? If MPC...

Q:

1. Draw the 3 X 3 (3 agents and 3 markets) circular flow of the economy and explain the interactions between and among these? 2. What is Marginal Propensity to Consume (MPC)? If MPC is 0.7, what is...

Q:

1. Draw the 3X3 (3 agents and 3 markets) circular flow of the economy and explain the interactions between and among these? 2. What is Marginal Propensity to Consume (MPC)? If MPC is 0.7, what is the...

Q:

Topic is: Social psychology and cognition This week you will be completing an Annotated Bibliography on a psychological topic in which you have interest and would like to know more about. You...

Q:

1. How did Pennsylvanias Quaker beginnings distinguish it from other colonies in British America? 2. What were the effects of the consumer revolution on the colonies? 3. How did the ideas of the...

Q:

Dave recently started day trading stock options. He was proud of himself when he made money on his first 3 trades. The 4 t h trade was a loser but he isn't worried because it wasn't his fault. The...

Q:

You have a $10 million capital budget and must make the decision about which investments your firm should accept for the coming year. Use the following information on three mutually exclusive...

Q:

As a result of lower interest rates, you are considering refinancing your mortgage. The existing mortgage has a 12 percent interest rate. The balance owed is $50,000, and the remaining term is 18...

Q:

You are considering refinancing your mortgage. Your current loan is at 7% with 14 years left and was negotiated one year ago with $2,000 closing costs. The new loan would be 5.5% for 15 years with...

Q:

David is a college professor who does some consulting work on the side. He uses 25% of his home exclusively for the consulting practice. He is single and 63 years old. His AGI (without consideration...

Q:

Some business analysts estimate that the length of time people work at a job has a mean of 6.2 years and a standard deviation of 4.5 years. a) Explain why you suspect this distribution may be skewed...

Q:

Question 3 6 pts software engineering is more concerned about Hardware development The developments of complex systems, in which software is embedded in Practical problems of producing software...

Q:

2. Start with a person you want to model. a. Use the five positions to investigate how this person positions himself in relation to others, i.e. how he uses the five positions in his interaction with...

Q:

1. Start with a leader that you want to model. a. What is the stated purpose of this person? b. What is the vision of this person? c. How does he seek to achieve his purpose and vision? d. What does...

Q:

2. Now change the performance so that you play out the dream in your inner the-atre. Apply colours to the images you envision. Give some pictures a stronger colour than others and vice versa. Also...