Multiple choice (1 Viewer)

[darkdog307]

Does anyone know how to do question 12 2010 HSC paper

q12 is a calculation question

 

[deswa1]

Can you post the question?

 

[darkdog307]

http://www.boardofstudies.nsw.edu.au/hsc_exams/hsc2010exams/pdf_doc/2010-hsc-exam-economics.pdf

Page 6, question 12. Sorry I don't know how to post the exact question lol

 

[cliches]

Oh yeah... how do you do this without Income?

 

[bobmcbob365]

Well, Y = C + S, where Y is income, C is consumption and S is saving......

 

[darkdog307]

Isn't it Y=C+S+T?

 

[bobmcbob365]

Yes it is, but we aren't given the taxation level, so we can assume this is just an example of a two sector economy. So we'll just assume income is given by consumption and saving only.

 

[crazy_paki123]

easy, you calculate MPC which is: 200-100/350-150 (change in consumption over change in income) which gives you 0.5
Then to find k you do 1/1-0.5 which is 2.

 

[bobmcbob365]

Since the multiplier is equal to 1/mps, we now try to find mps which is equal to change in saving divided by change in income. I.e. mps = 100/200 = 1/2. Therefore multiplier = 2