Economics 121 C
Quiz 8
Thursday, May 15, 1997
Prof. A. D. Becker
Name:___________________________

In the table are data for macroeconomic aggregates for a country in billions of real (1992) dollars. Net exports (NX) are zero both years.
Year
Income/

Output

(Y/AD)
Consump-

tion

(C)
Invest-

ment

(I)
Govern-

ment

(G)
Net

Taxes

(T)
Govt.

Deficit
Disposable

Income

(Yd)
Savings

(S)
1
6730
4500
1260
80
2
6850
4580
1010
1260
1200
60

a) (6 points) Fill in the missing values in the table.

b) (6 points) Based on the information in the table, provide an estimate of the marginal propensity to consume out of total income.









c) (6 points) If government expenditures are reduced by 60, what do you predict the new level of national income/aggregate demand (Y, AD) will be?

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