For an economy the following functions have been given: C = 100 + 0.8Y S= -100 + 0.2Y I= 120 – 5r M, = 120 Ma = 0.2Y – 5r Calculate the following: 5.1.1. IS equation 5.1.2. LM equation 5.1.3. Equilibrium level of income

For an economy the following functions have been given: C = 100 + 0.8Y S= -100 + 0.2Y I= 120 – 5r M, = 120 Ma = 0.2Y – 5r Calculate the following: 5.1.1. IS equation 5.1.2. LM equation 5.1.3. Equilibrium level of income

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Solve 5.1.1, 5.1.2 and 5.1.3 earky

For an economy the following functions have been given:
C = 100 + 0.8Y
S= -100 + 0.2Y
I= 120 – 5r
M, = 120
Ma = 0.2Y – 5r
Calculate the following:
5.1.1. IS equation
5.1.2. LM equation
5.1.3. Equilibrium level of income

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