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Consider the following model i) C = 1650 + mpc (Y - tY) ii) I = 800 iii) G = 500 iv) X - M

Consider the following model

i) C = 1650 + mpc (Y - tY)

ii) I = 800

iii) G = 500

iv) X - M = 500 - mpi (Y)

where:

t = the (flat) tax rate

mpc = the marginal propensity to consume

mpi = the marginal propensity to import

suppose mpc = .60, t = .15, mpi = .2

Given the information above, solve for the equilibrium output:

How do I solve?

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