ECON 201 ( 2 assignments )

Assignment-2

Deadline: 01/08/2021 @ 23:59

For Instructor’s Use only

Instructions – PLEASE READ THEM CAREFULLY

· Assignments will vary across CRNs, so make sure you do the assignment associated with your CRN.

· Any matched results will be considered cheating, so it results into ZERO grade.

· Show all works for calculation, final result will not be accepted without showing how you reach to it.

· NO LATE ASSIGNMENT WILL BE ACCEPTED UNDER ANY CIRCUMSTANCES.

· YOU CAN NOT USE ANY OUTSIDE RESOURCES FOR HELP ON THE ASSIGNMENT & IF YOU HAVE ANY QUESTION, ASK ONLY YOUR INSTRUCTOR ( [email protected] ). Or, attend help session. OTHERWISE, IT WILL BE CONSIDERED CHEATING.

· The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.

· Assignments submitted through email will not be accepted.

· Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling your information on the cover page.

· Students must mention question number clearly in their answer.

· Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.

· All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).

· Submissions without this cover page will NOT be accepted.

Question 1 (4 points) Assume we have a closed economy, the data you go over it on discussion 1 (table 17) show the following information for the third quarter of 2020 (assume export = import = net export = 0):

· National income (excluding net export) = 517,536,000,000 SAR.

· Consumption equal 222,526,000,000 SAR.

· Government expenditures equal 140,199,000,000 SAR.

Assume that the consumption tax rate is 15% (Value Added Tax) and 20% for capital (investment). Solve for the following (parts a to e) if Saudi Arabia is considered a closed economy:

a- Tax revenue. Hint, there are two types of tax; sales tax (VAT) and capital or investment. First, calculate investment to find tax revenue from investment. Add these two together.

b- Investment.

c- Private saving.