CECN204 ASSIGNMENT 2 S2009

CECN204 ASSIGNMENT 2 S2009 - CECN204 Distance Course...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
CECN204 Distance Course Spring/Summer 2009 Assignment Details REQUIRED ASSIGNMENTS There will be two assignments in lieu of the usual mid-term exams. The final exam will be comprehensive and cover the full content in the course outline. Your assignments are to be submitted via the Assignments Drop box. Once received, they will be marked within a week and then returned to you with your marks and instructor comments. The final exam will be of a comprehensive nature, covering all chapters taught. Assignment 2 Details (Covers Week 4-10) Please make sure that you explain all steps in arriving at your answers to the following questions from your text. All calculations should be done by hand. You can use Excel or Lotus 123 spreadsheets to verify your answers. Your marks will be weighted on the basis of your reasoning more than the exact numerical answer itself. 1. {15 marks} Suppose that Canadians spend 80% of their income (GDP) on consumption, and the minimum level of consumption for basic necessities (even if the income is zero) is $200 billion. Answer the questions. a.Construct the consumption and savings functions such as C=a+bY and S=Y-C, where C=consumption and Y=Income (GDP) and show them graphically. b.Identify the equilibrium GDP. c.Compute and explain MPC and MPS. d.Compute the multiplier. e.If investment spending of $20 billion is added in the system, how much will the GDP rise? 2.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 12/13/2010 for the course X X taught by Professor X during the Spring '10 term at Ryerson.

Page1 / 4

CECN204 ASSIGNMENT 2 S2009 - CECN204 Distance Course...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online