Suppose you are estimating a consumption function Y₁ = P₁+ B₂X₁+ and a saving function Z₁ = Ø₁ + Ø₂X₁ + ²₁ where Y-consumption, Z=savings, X-income. i. Apakah tanda (positive or negative) yang anda jangka bagi B₂ dan Ø₂? What sign (positive or negative) would you expect for ₂ and Ø₂?
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- Consider the two-period Neoclassical growth model seen in class. Let the utility function take the logarithmic form U(C)=In C.Consumption/Savings 1000 800 600 400 200 0 -200 Select one: 200 400 600 800 1000 1200 1400 1600 S Refer to the graph above to answer this question. What is the equation for the saving function? A. S=200+ 0.4Y. B. S=-200+ 0.6Y. X C. S-200+ 0.8Y. OD. S-200 +0.2Y. OE. S=200 - 0.2Y. IncomeRefer to the following figure. The equation for this household's saving function is Saving -300 1,000 saving Income
- Help me1. a. Explain consumption and saving function by using numerical example and diagram.It has been said that a society withhigh savings rate is a society with ahigh standard of living. Discuss thelink (if any) between saving andstandard of living and also explainthe overall economic function ofprofits.
- 2.Explain how savings function is derived from the consumption function, and how the saving schedule and graph of the saving function are constructedExplain how does adecrease in the current income y affect the consumer’s consumption-saving decision. In particular,explain: 1) How will current consumption c, future consumption c′, and savings s change; 2) Arethere any substitution effect or income effect. Make sure you draw two figures, one for the borrowersand one for the lenders2. is it possible for total saving to fall when people beome more thirfty?
- Explain the three main important properties of the saving function?Assume an economy with 600 consumers. Each consumer has income in the current period of 70 units and future income of 80 units and pays a lump-sum tax of 10 in the current period and 25 in the future period. The market real interest rate is 12%. Of the 600 consumers, 400 consume 70 units in the future, while 200 consume 20 units in the future. a. Determine each consumer's current consumption and current saving. For the group of consumers that consume 70 units in the future, current consumption is and current saving is For the group of consumers that consume 20 units in the future, current consumption is, and current saving is (Round to two decimal places as needed.)Which of the following situations represents investment? Saving? ExplainYour family takes out a mortgage and buys a new house. You use your paycheque to buy stock in Sagicor Financial Services.