S(r)=2+r I(r)=10-r CF(r)=2-2r the equilibrium condition is S(r)=I(r)+CF(r) 2-1 What is the r that solves this system? r= 2-2 What is the equilibrium value of S? In other words, for the value of r in equilibrium, what is the associated value of S?
S(r)=2+r I(r)=10-r CF(r)=2-2r the equilibrium condition is S(r)=I(r)+CF(r) 2-1 What is the r that solves this system? r= 2-2 What is the equilibrium value of S? In other words, for the value of r in equilibrium, what is the associated value of S?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
S(r)=2+r
I(r)=10-r
CF(r)=2-2r
the equilibrium condition is S(r)=I(r)+CF(r)
2-1 What is the r that solves this system? r=
2-2 What is the equilibrium value of S? In other words, for the value of r in equilibrium, what is the associated value of S?
Expert Solution
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Introduction
To solve, we will substitute S(r)=2+r & I(r)=10-r & CF(r)=2-2r in S(r)=I(r)+CF(r).
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