Assume that the economy is now governed by a government and begins trading with other economies. The economy is described by the following set of equations.?=1000+0.5⋅?dID = 600G=700T=400EX=0.1⋅YIM=100+0.1⋅YYD = Y - TCalculate the equilibrium level of output Y*a) 2857b) 4000c) 6274d) 4400 Whats the government expenditure multiplier?Whats the tax multiplier?Whats the ba;anced budget multiplier?

Equilibrium in the market occurs where income is equal to aggregate expenditure.

Answered: Assume that the economy is now governed…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Assume that the economy is now governed by a government and begins trading with other economies. The economy is described by the following set of equations.

?=1000+0.5⋅?_d
I^D = 600

G=700
T=400
EX=0.1⋅Y
IM=100+0.1⋅Y
Y^D = Y - T

Calculate the equilibrium level of output Y*

a) 2857

b) 4000

c) 6274

d) 4400

Whats the government expenditure multiplier?

Whats the tax multiplier?

Whats the ba;anced budget multiplier?

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