C = 120 +0.8X (Y -T) - Consumption function T = 400 - Taxes I = I(r) =50-5Xr - Investment function G = 400 -
C = 120 +0.8X (Y -T) - Consumption function T = 400 - Taxes I = I(r) =50-5Xr - Investment function G = 400 - Government purchases M = 2,000 - Money supply P = 5 - Price level M d =2XY - 25 X r - Demand for real money balancesFrom the above list, the resulting equation of the IS curve is: A.Y+25>
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
