In a closed economy, the gross domestic product is $25,000, consumption is $8,200 and taxes are $3,700. If the national saving is 3,000, if the investment function is represented by I = 3,400-80r, the equilibrium interest rate is: Select one: a. 12% b. 5% c. 3% d. 8% e. None of the answers are correct

In a closed economy, the gross domestic product is $25,000, consumption is $8,200 and taxes are $3,700. If the national saving is 3,000, if the investment function is represented by I = 3,400-80r, the equilibrium interest rate is: Select one: a. 12% b. 5% c. 3% d. 8% e. None of the answers are correct

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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QNO: 3 Consider an economy discribed by the followng Equations Y= C +1+ G. C= 250 + .75(Y-T) | = 1000-50r. a) In this economy Computé private saving, public saving and national saving b)Find equilibrium rate of interest c)Now Suppose that G rises to 1,250 Compute private, and National saving. d) find the new equilibrium. Y= 5000 G=1000 |=1000 7:42 pm
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