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3. Consider the following Keynesian model: C=100+ 0.8 (Y-T) Planned Investment (I) = 100 Government Purchase (G) = 50 Taxes (T) =50 a. Graph
3. Consider the following Keynesian model: C=100+ 0.8 (Y-T) Planned Investment (I) = 100 Government Purchase (G) = 50 Taxes (T) =50 a. Graph planned expenditure (PE) as a function of income (Y). b. What is equilibrium level of income (Y)? c. If government purchase (G) is increases to 50, what is new equilibrium income?
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Structural Analysis
Authors: Russell Hibbeler
10th Edition
134610679, 978-0134610672
