The following is information for the economy of Tandor, where taxes are wholly autonomous: C = 50+ 0.8YD where YD = (Y-T) I = 150 a. The value of equilibrium income is $ b. At equilibrium, the amount of the budget c. If government increased both its spending and taxes by $70, the new equilibrium income would be $ A) $940, budget Balance is 0 and $1130 B) $1040, budget Balance is 0 and $1080 C) $1140, budget Balance is 0 and $1060 G = T = 300 XN 104-0.15Y D) $1240, budget Balance is 0 and $1380

The following is information for the economy of Tandor, where taxes are wholly autonomous: C = 50+ 0.8YD where YD = (Y-T) I = 150 a. The value of equilibrium income is $ b. At equilibrium, the amount of the budget c. If government increased both its spending and taxes by $70, the new equilibrium income would be $ A) $940, budget Balance is 0 and $1130 B) $1040, budget Balance is 0 and $1080 C) $1140, budget Balance is 0 and $1060 G = T = 300 XN 104-0.15Y D) $1240, budget Balance is 0 and $1380

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

The following is information for the economy of Tandor, where taxes are wholly autonomous:
C = 50+ 0.8YD where YD = (Y-T)
G = T = 300
XN 104 -0.15Y
I = 150
a. The value of equilibrium income is $
b. At equilibrium, the amount of the budget
c. If government increased both its spending and taxes by $70, the new equilibrium income would be $
A) $940, budget Balance is 0 and $1130
B) $1040, budget Balance is 0 and $1080
C) $1140, budget Balance is 0 and $1060
D) $1240, budget Balance is 0 and $1380

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Step 1: Define Equilibrium Income

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Step 2: Find the Value of the Equilibrium Income

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Step 3: Find the amount of Budget at the Equilibrium

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Step 4: Find the Equilibrium Income when G and T increase by $70

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