Assume that equilibrium GDP (Y) is 5,000. Consumption (C) is given by the equation C = 500+ 0.6 (Y-T). Taxes (T) are equal to 600. Government spending is equal to 1,000. Investment is given by the equation I=2,160 - 100 r, where r is the real interest rate, in percent. In this case, the equilibrium real interest rate is: 5 percent. 8 percent. 10 percent. 13 percent.
Assume that equilibrium GDP (Y) is 5,000. Consumption (C) is given by the equation C = 500+ 0.6 (Y-T). Taxes (T) are equal to 600. Government spending is equal to 1,000. Investment is given by the equation I=2,160 - 100 r, where r is the real interest rate, in percent. In this case, the equilibrium real interest rate is: 5 percent. 8 percent. 10 percent. 13 percent.
Chapter1: Making Economics Decisions
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![Assume that equilibrium GDP (Y) is 5,000. Consumption (C) is given by the equation C =
500+0.6 (Y-T). Taxes (T) are equal to 600. Government spending is equal to 1,000.
Investment is given by the equation I= 2,160 - 100 r, where r is the real interest rate, in
percent. In this case, the equilibrium real interest rate is:
5 percent.
8 percent.
10 percent.
13 percent.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F55d7d476-142a-464a-9a3c-33461276aa85%2F53627781-fb28-42b3-b167-19fca93ad0e8%2Flt6f61e_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Assume that equilibrium GDP (Y) is 5,000. Consumption (C) is given by the equation C =
500+0.6 (Y-T). Taxes (T) are equal to 600. Government spending is equal to 1,000.
Investment is given by the equation I= 2,160 - 100 r, where r is the real interest rate, in
percent. In this case, the equilibrium real interest rate is:
5 percent.
8 percent.
10 percent.
13 percent.
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