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There is equilibrium in a closed economy (that which doesn't encourage in international trade), when there is the circular flow of income between House-holds & firms, where the house-holds own the factors of production, which is given to firms, which in return gives factors of income for their services. the firm uses fatcors of production to produce goods & services, whereas house-holds consume goods & services using factors of production. Here NI=NO=NE.

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โˆ™ 2011-09-12 23:25:43
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Q: How equilibrium income in a closed economy is determined?
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Who will get the goods and services produced in the economy?

This is determined by the distribution of income in the society.

In a market economy income is primarily determined by?

the quantities and prices of the resources that households supply.

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The economy is no longer closed and all other assumptions hold.

What are the determinants of induced consumption in Keynesian model of a closed economy with a government sector?

Income and taxes

How do you calculate the equilibrium level of consumption?

you first have to culculate equilibrium level of income.

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Equilibrium level of income is solved by following a system of equations. For a detailed understanding, study the Law of Mass Action of chemical reactions.

What is the equilibrium theory and what are its potential effects on disadvantaged Americans?

The Equilibrium Theory is an explanation of the behavior of supply, demand, and prices in a whole economy. The theory has negative effects on disadvantaged Americans. As the price of products naturally move toward the equilibrium based on the supply and demand, low-income families cannot afford the products.

Income consumption curve?

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Types of equilibrium in economics?

stable and unstable <..........................................> Abeer Aamir Equilibrium is the state of balance between forces, influences. Any economy where equilibrium condition prevails is said to be prosperous. The state of equilibrium is found in several aspects of economics. Market Equilibrium Competitive Market Equilibrium General Equilibrium Lindahl Equilibrium Partial Equilibrium Market Equilibrium: In this situation, goods produced are equal to the goods consumed. Competitive Market Equilibrium: CME includes a sector of policies and allocation is done in such a way that each traders maximises his profit function. General Equilibrium: General equilibrium is the study of Supply and demand prices. Lindahl Equilibrium: In this situation, individuals have to pay for any public good according to the marginal benefits they can draw from the public goods. Partial Equilibrium: PE is a state in an economy where market is cleared of some specific goods. The market clearance is obtained when the price of all substitutes and complements as well as income levels of the consumers are in variable.

What are the factors affecting demand for travel?

Disposable Income. income Economy uncertainty in economy inflation Climate

What is the underground economy?

products and income that are not reported as income to the government

What is the Definition of equilibrium income?

Equilibrium income exists when the supply of a good balances the demand of the good. This state prevents the fluctuation of price based on too little or too much supply on-hand.

Do income statement accounts closed at the end of the period?

yes, all accounts must be closed at the end of the period on the income statement

What is consumer's equilibrium?

consumer equilibrium states that consumer maximise his utility with the given income and with the given price or when a consumer getting maximum satisfaction with available resources then he will be in a state of equilibrium.

What are the importance of national income in the economy?

The importance of national income in the economy is absolutely huge. This determines whether or not there is money that can be spent.

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In macroeconomics, equilibrium level of output occurs when income is equivalent to expenditures. That should be the same amount with the output.

What is underground economy?

Production and income not reportedas income to the goverment. (by Solomon Zelman)

How do cyclones affect the economy?

An effect that cyclone's have on the economy are that the income for businesses that are affected by them is reduced. Also there are crop losses and less income for farmers.

What account has a balance equal to the net income before the account is closed?

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No. It has a medium-income economy with an income per capita of USD$13,500-14,337.

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Net income is determined by subtracting expenses from income. This will give the actual amount of profits at the end of the day.

What is the economy and income of the people in Guatemala?

The GDP is very low in Guatemala and they have a trditional economy.

Which account has a balance equal to net income immediately before it is closed?

income summary account.

how is annual income determined?

You just have to multiply number of hour per week (working hours) to your hourly rate. Then, multiply it to 52 weeks (thats the total number of weeks in a year). By then you get your gross annual income.

If Marginal propensity to consume of 06 and a marginal propensity to import of 02 the government increases its spending by 2 billion and raises taxes by 1 billion what happens to equilibrium income?

The equilibrium income would increase 1.06 billion dollars.