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g answer box. (20 points) Consider an economy described by the following: C = $4.Otrillion I = $1.5trillion G = $3.0trillion T = $3.Otrillion STAPLES
g answer box. (20 points) Consider an economy described by the following: C = $4.Otrillion I = $1.5trillion G = $3.0trillion T = $3.Otrillion STAPLES NX = $1.0trillion f =0 mpc = 0.8 d = 0.35 x = 0.15 r = 1% 2 = 0.5 a. Calculate an eversion for the IS, MP and AD curves 2 MP curve 1= IS curve Y= AD curve Y= b. Let AS curve be given by the relation: 7 = 6 + 1.5(Y - 25.5) (i.e. the price shock pis zero). What are equilibrium values of inflation, output and the real interest rate{nt, Y, r}
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