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Answer:
Explanation:
Effect of crowding out:
The crowding out phenomena describes the economic phenomena in which an increase in government public spending leads to reduced or perhaps may eliminate of private investment.
Multiplier:
The multiplier represents the ratio of income to investment change.
Given that:
$13 billion increase in government spending will lead to a $52 billion
The rise in demand for goods & service will be the value of multiplier which is
= 52/13
= 4
To determine the multiplier using the formula:
Multiplier = 1 /( 1- MPC)
4 = 1/(1 - MPC)
4 (1 - MPC) = 1
(1- MPC) = 1/4
-MPC = 0.25 - 1
MPC = 0.75
Marginal propensity to consume = 0.75
The answer to the question above as to what types of income does Jeff have if he works as a computer repair technician and he has money in a savings account and he owns some stock as an investment, Jeff gains his income through salary from his job as a repair technician, interest in the savings account and dividend in the stocks.
Answer:
The equilibrium point
Explanation:
The equilibrium point is where there is an exact quantity of production output that perfectly satisfies the total demand of the market.
Answer: GNP; GDP
Explanation:
<em>The value of what a Canadian-owned Tim Hortons produces in South Korea is included in the Canadian </em><em><u>GNP </u></em><em>and the South Korean </em><em><u>GDP</u></em><em>. </em>
Gross National Product refers to the total amount of domestic production and foreign production that can be attributed to the residents of a nation.
This means that GNP includes the GDP and income earned by residents of the country in other countries but less the income earned by foreigners in the country. For Canada therefore, the value of goods produced by the Canadian company in South Korea will be added to the GNP.
Gross Domestic Product (GDP) on the other hand is simply the total final value of goods and services produced in a country regardless of if it was foreigners or residents doing the production. The value of what a Canadian-owned Tim Hortons produces in South Korea is therefore included in South Korea's GDP.
