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Consider the following classical economy: Desired consumption: C = 280 + 0.500Y - 200r. Desired investment: / = 220 - 300r. Government purchases: G =

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Consider the following classical economy: Desired consumption: C" = 280 + 0.500Y - 200r. Desired investment: / = 220 - 300r. Government purchases: G = 100. Net exports: NX = 140 - 0.100Y - 0.500e. Real exchange rate: e = 18 + 600r. Full-employment output: Y = 900. a. What are the equilibrium values of the real interest rate, real exchange rate, consumption, investment, and net exports? Real interest rate = Real exchange rate = Consumption = Investment = Net exports =

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