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1.Answer the following questions using the aggregate expenditures model of the economy described below. C = 50 + .8Y d T = 60 + .25Y
1.Answer the following questions using the aggregate expenditures model of the economy described below.
C = 50 + .8Yd
T = 60 + .25Y
Ia = 80
Ga = 58
Xa = 60
M = .1Y
A What are the marginal propensity to consume, the marginal tax rate, and the marginal propensity to import?
B What is the saving function? What is the marginal propensity to save?
C What is the aggregate expenditure function?
D What is the equilibrium level of real GDP?
E What is the size of the multiplier?
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