Practice Problem Set Two

# Practice Problem Set Two - total flows of money into firms...

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Government Households Foreign Sector Firms Markets for goods and services Financial Markets Factor Markets Government purchases = \$100m Government borrowing = \$50m Transfers = \$100m Taxes = \$150m Consumer expenditure = \$700m Private savings = \$250m Borrowing and stock issues by firms = \$1,170m Investment expenditure = \$170m GDP Foreign borrowing and sales of stock = \$120m Imports = \$20m Exports = \$50m Foreign lending and purchases of stock = \$90m Wages, profit, interest, rent Wages, profit, interest, rent Practice Problem Set 2

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Questions? 1. What is the value of GDP of the U.S. economy? 2. Does the total flows of money out of households equal to the total flows of money into households? 3. Does the total flows of money out of firms equal to the
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Unformatted text preview: total flows of money into firms? • 4. Does the total flows of money out of the government equal to the total flows of money into the government? • 5. Does the total flows of money out of foreign sector equal to the total flows of money into foreign sector? • 6. Compute the flows of money into the financial markets and the flows of money out of the financial market. Are they equal? • 7. Compute the flows of money into the market for goods and services and the flows of money out of the market for goods and services. Are they equal? • 8. Compute the flows of money into the factor market and the flows of money out of the factor market. Are they equal?...
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Practice Problem Set Two - total flows of money into firms...

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