\n| \n 120<\/span><\/p>\n<\/td>\n | \n 100<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n 200<\/span><\/p>\n<\/td>\n | \n 200<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n 280<\/span><\/p>\n<\/td>\n | \n 300<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n 360<\/span><\/p>\n<\/td>\n | \n 400<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n 440<\/span><\/p>\n<\/td>\n | \n 500<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n 520<\/span><\/p>\n<\/td>\n | \n 600<\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n1. <\/span><\/span><\/span>Assume autonomous real investment is $30, autonomous real government spending is $30, and autonomous real net exports is -$20. Compute Aggregate Expenditures<\/strong> at each level of real GDP. What is the value of equilibrium real GDP?<\/span><\/p>\n2. <\/span><\/span><\/span>What is the value of the marginal propensity to consume?<\/span><\/p>\n3. <\/span><\/span><\/span>What is the value of the marginal propensity to save?<\/span><\/p>\n4. <\/span><\/span><\/span>Compute the value of the Keynesian spending multiplier on goods and services.<\/span><\/p>\n5. <\/span><\/span><\/span>Give the amount of the change in the equilibrium level of Real GDP due to a $6 increase in spending on goods and services by households.<\/span><\/p>\n6. <\/span><\/span><\/span>Give the amount of the change in the equilibrium level of Real GDP due to a $6 increase in spending on goods and services by the federal government.<\/span><\/p>\n7. <\/span><\/span><\/span>Give the amount of the change in the equilibrium level of Real GDP due to a $3 decrease in spending on goods and services by state governments.<\/span><\/p>\n8. <\/span><\/span><\/span>Suppose the equilibrium level of Real GDP decreases by $20. What was the amount of the change in autonomous expenditures which caused this to happen?<\/span><\/p>\n9. <\/span><\/span><\/span>Compute the value of the Keynesian tax multiplier.<\/span><\/p>\n10. <\/span><\/span><\/span>Give the amount of the change in the equilibrium level of Real GDP due to a $6 increase in lump-sum taxes.<\/span><\/p>\n11. <\/span><\/span><\/span>Give the amount of the change in the equilibrium level of Real GDP due to a $3 decrease in lump-sum taxes.<\/span><\/p>\n12. <\/span><\/span><\/span>Suppose spending on goods and services is increased by $6 and lump-sum taxes are increased by $6. Give the amount of the change in the equilibrium level of Real GDP.<\/span><\/p>\n13. <\/span><\/span><\/span>Suppose spending on goods and services is decreased by $3 and lump-sum taxes are decreased by $3. Give the amount of the change in the equilibrium level of Real GDP.<\/span><\/p>\n14. <\/span><\/span><\/span>Compute the value of the Keynesian spending multiplier for transfer payments.<\/span><\/p>\n15. <\/span><\/span><\/span>Give the amount of the change in the equilibrium level of Real GDP due to a $6 increase in unemployment compensation.<\/span><\/p>\n16. <\/span><\/span><\/span>Give the amount of the change in the equilibrium level of Real GDP due to a $3 decrease in Social Security payments.<\/span><\/p>\n <\/span><\/p>\n17. <\/span><\/span><\/span>The federal government passed a one-time tax surcharge to increase tax revenues in 1968 to help pay for the Vietnam War. Was this expansionary fiscal policy, contractionary fiscal policy, or neutral?<\/span><\/p>\nQuestions 24-27:<\/span><\/span><\/strong>Given the following hypothetical U.S. Federal income tax brackets and marginal tax rates for single persons for 2011:<\/span><\/strong><\/span><\/p>\n\n \n\n\n| \n Taxable Income<\/span><\/strong><\/span><\/p>\n<\/td>\n| \n Marginal Tax Rates<\/span><\/strong><\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n 0 – $20,000<\/span><\/p>\n<\/td>\n | \n 5%<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n $20,000 – 60,000<\/span><\/p>\n<\/td>\n | \n 10%<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n $60,000 – 200,000<\/span><\/p>\n<\/td>\n | \n 20%<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n Over $200,000<\/span><\/p>\n<\/td>\n | \n 30%<\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n <\/span><\/p>\ncompute the total tax due AND the average tax rate (ATR) for a single person with taxable income in 2011 (show your calculations!) of<\/span><\/p>\n24. <\/span><\/span><\/span>$5,000<\/span><\/p>\n25. <\/span><\/span><\/span>$50,000<\/span><\/p>\n26. <\/span><\/span><\/span>$500,000<\/span><\/p>\n27. <\/span><\/span><\/span>Which tax structure is this, based on your values of ATR?<\/span><\/p>\nQuestions 28-30:<\/span><\/span><\/strong>For each of the following tax liability schedules, identify whether it represents a progressive, regressive, or proportional tax structure:<\/span><\/strong><\/span><\/p>\n\n\n\n| \n Taxable Income<\/span><\/p>\n<\/td>\n | \n Tax Liability #28<\/span><\/p>\n<\/td>\n | \n Tax Liability #29<\/span><\/p>\n<\/td>\n | \n Tax Liability #30<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n $1,000<\/span><\/p>\n<\/td>\n | \n $100<\/span><\/p>\n<\/td>\n | \n $50<\/span><\/p>\n<\/td>\n | \n $100<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n $2,000<\/span><\/p>\n<\/td>\n | \n $100<\/span><\/p>\n<\/td>\n | \n $100<\/span><\/p>\n<\/td>\n | \n $300<\/span><\/p>\n<\/td>\n<\/tr>\n\n| \n $3,000<\/span><\/p>\n<\/td>\n | \n $100<\/span><\/p>\n<\/td>\n | \n $150<\/span><\/p>\n<\/td>\n | \n $500<\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n <\/span><\/p>\n <\/span><\/p>\n31. <\/span><\/span><\/span> <\/span><\/p>\n32. <\/span><\/span><\/span>What is a Phillips Curve? What two rates are being related?<\/span><\/p>\n33. <\/span><\/span><\/span>What were the aggregate supply shocks to the American economy during the 1970s and early 1980s? How did these shocks affect interpretation of the Phillips Curve?<\/span><\/p>\n34. <\/span><\/span><\/span>What are the characteristics of the long-run Phillips Curve? How is this curve related to the natural rate of unemployment?<\/span><\/p>\n <\/span><\/p>\n <\/span><\/p>\n35. <\/span><\/span><\/span>Calculate the value of the velocity of money assuming nominal national income is $50,000 and the money supply is $10,000. Explain what this value of velocity which you computed means.<\/span><\/p>\nQuestions 44-45:<\/span><\/strong> Using the Rudebusch version of the Taylor rule from the internet activity, compute the value of the Federal Reserve’s target for the federal funds rate should be if<\/span><\/p>\n
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