JNU 2018

[Nits]

Yes even I did the same thing,
Y(t) = a/(s-b)
if s>b, then Y(t) gonna be positive & finite.

[soimmoi]

Thank you, can you please tell ques 42, sss 2017

[Nits]

Rate of Interest for Gold = (7*100)/140 = 5%

Rate of Interest for Money = ( 18*100)/120 = 15%

Hence Money Interest is 3 times more than Gold Interest. Hence Expected % rise in Rupee price of Gold will be 3 times more in the next period.

[soimmoi]

Thank you so much:)

[Econenthusiast]

thanks :)

[soimmoi]

Q1) Given : (jnu past year) please cross check
GDP at factor cost(FC) 10000
Net factor income from abroad 500
Net Indirect taxes(NIT) 1500
Government(non-investment) expenditure at market prices(MP) 1500
current account deficit on balance of payments 500
gross savings of government -300

Calculate :
1) GDP at MP  :   11500
2) GNP at MP  :   12000
3) if pvt consumption expenditure is .75 times the GNP at MP, calculate Gross investment :
4) Gross savings in the economy :  
5) Gross pvt savings :
6) pvt sectors savings ratio out of its disposable income :  0.25

[Econenthusiast]

I got this for 3 soimmoi, how did you arrive at your answer:
3) Here T-G = -300  G = 1500
T = 1200

Y - cY - cT = 2100,
Public savings + Pvt savings + M-X = Investment

2100 -300 +500 = 2300


Soimmoi, I don't think your last answer is right. In that they are asking for the Average propensity to consume which is equal to S/ Disposable Income, .25 here is the MPS.. also do you know which year this question is taken from ??

[soimmoi]

3) pvt savings = 0.75(12000) = 9000
gdpmp (11500) = 9000+ 1500 + I - 500
I = 1500
4) GS - GI = CA     GS - 1500 = 500      GS =  2000
5) Sp + Sg = I+ CA     Sp + (-300) = 1500 + (-500)
Sp = 1300
6) pvt savings = 0.25(12000) = 3000   3000/12000 = 0.25

[Rayee]

i think you missed the trade balance part,
c) GDPmp=C+I+G+X-M
=>11500=9000+I+1500+(-1000)
=>I=2000

[Econenthusiast]

guys I guess while calculating consumption we should take consumption from disposable income .75(Y-T)

[soimmoi]

why 1000 for x-m, CAD is just - 500
hey, I don't think so taxes will be included.

[Rayee]

soimmoi
CAD=M-(X+NFIA+Rf)
=>500=M-X-500+0
=>X-M=-1000

besides the answer you previously got for GS is correct, its 1500, not 2000. you see if GS=2000 and Sp=1300,
now Sg=-300, so it doesn't add up.
Also we definitely don't take tax into account, it clearly says C is .75 times GNPmp.
PS-please take a look at the other thread !!!

[soimmoi]

Can you post the whole ans, I'm getting confused
And does anyone of you know what topics to study for essay

[Rayee]

jnu

given:
-GDPfc=10,000
-NFIA=500
-net IT=1500
-Gmp=1500
-CA deficit=M-(X+NFIA+Rf)=500
                  =>X-M=-1000
-Sg=T-G=-300


a) GDPmp=GDPfc+net IT=11500
b)GNPmp=GDPmp+nfia=12000
c)C=.75(GNPmp)=9000
    GDPmp=Cmp+I+Gmp+X-M
    11500=9000+I+1500+(-1000)
     I=2000
d)for S, what you did previously was correct.
another way is S=GNP-C-G+Rf=12000-9000-1500+0=1500
e)S=Sp+Sg=>Sp=1800

[Econenthusiast]

what about equating savings and investment, I can't seem to find fault in the method but something seems fishy as well. Could you tell if the method is right Rayee ?

[Econenthusiast]

same, I'm confused as well. Will let you know if I get to know any

[Econenthusiast]

GDPmp=Cmp+I+Gmp+X-M
    11500=9000+I+1500+(-1000)
     I=2000

Here you should take 12,000 as GNPmp if you are taking net exports into account as well

[Rayee]

saving doesn't need to be equal to investment when there is C/A deficit or surplus.

[soimmoi]

Thank you, Rayee:)

[Econenthusiast]

Yes Rayee, but what I meant was we could use, S + Imports = I + Exports right ?. A deficit in the current account is balanced by a surplus in the savings account which shows that the equality above exists