# answer following problems

__Problem 1__

Suppose GDP equals $300 trillion, consumption equals $24 trillion, the government spends $3 trillion and has a budget deficit of $500 billion.

- Find public saving, taxes, private saving, national saving, and investment.

__Problem 2 __

You take $500 that you held as currency and put it into the banking system. The reserve ratio is equal to 20%.

- Calculate the money multiplier.
- By how much will increase the total amount of deposits in the banking system?
- By how much will increase the money supply?

__Problem 3 __

At the begening of 2018, a town has 152,000 employed people and 8000 unemployed people. The remaining 40,000

people in the town are not in the labor force.

Based on these numbers:

- Calculate the town’s unemployment rate
- Calculate the town’s labor force participation rate
- Calculate Suppose that 10,000 people decide to join the labor force. Of these 10,000 people 7,800 find jobs. What is the unemployment rate at the end of 2018?