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Consider the goods market model where consumption is given by: C = c + C(Y - T), investment is given by: I = bo +
Consider the goods market model where consumption is given by: C = c + C(Y - T), investment is given by: I = bo + byY - bi, and tax is given by T = to + tY. G is government spending and is given. Assuming Co = 100, C1 = 0.6, bo = 150, by = 0.2, ty = 0.3, and by = 1,000. Keeping all other things constant, what will be the change in the equilibrium output (Y*) in the goods market if G is increased by $100 (round to the nearest decimal point)
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