Macroeconomics 8th Edition by David Colander

تمرين 1

Congratulations! You've just been appointed chairman of the Council of Economic Advisers in Textland. The mpe is.8. There is a recessionary gap of $400.
a. The government wants to eliminate the gap by changing expenditures. What policy would you suggest?
b. Your research assistant comes running in and tells you that instead of changing expenditures, the government wants to achieve the same result by decreasing taxes. What policy would you recommend now? (Requires reading and using the math in Appendix A of the chapter "The Multiplier Model.")
c. Your research assistant has a worriedd. She still has a pained expression, "What's wrong?" you ask. "You didn't let me finish," she says. "Not only was there a marginal tax rate of.2; there's also a marginal propensity to import of.2." Again you interrupt to make sure she doesn't feel guilty. Again you say, "No problem," and recalculate your answers to parts a and b to account for the new information. What are your new answers? (Requires reading Appendix A of the chapter "The Multiplier Model.")
e. That pained