Given an economy described by the following set of equations. Y = C(Y - T) +...

Given an economy described by the following set of equations. Y = C(Y - T) + I(r) + G C = 200 + 0.80(Y - T) I = 300 - 2r G = 400 T = 200 (M/P)d = 0.80Y - 8r Ms = 5,600 Price-level = P = 2 What is the equilibrium interest rate?

(Same setup as above)

Given an economy described by the following set of equations.

Y = C(Y - T) + I(r) + G C = 200 + 0.80(Y - T) I = 300 - 2r G = 400 T = 200 (M/P)^d = 0.80Y - 8r M^s = 5,600 Price-level = P = 2

What is the equilibrium level of GDP?

(Same setup as above)

Given an economy described by the following set of equations.

Y = C(Y - T) + I(r) + G C = 200 + 0.80(Y - T) I = 300 - 2r G = 400 T = 200 (M/P)^d = 0.80Y - 8r M^s = 5,600 Price-level = P = 2

What is the equilibrium level of consumption?

(Same setup as above)

Given an economy described by the following set of equations.

Y = C(Y - T) + I(r) + G C = 200 + 0.80(Y - T) I = 300 - 2r G = 400 T = 200 (M/P)^d = 0.80Y - 8r M^s = 5,600 Price-level = P = 2

What is the equilibrium level of investment?

Solutions

Expert Solution

Rahul Sunny answered 1 year ago

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