Question
Hi there, I need help with the following practice question. The following parameters are for the national economy of Bangladesh for the year 2015 (in
Hi there, I need help with the following practice question.
"The following parameters are for the national economy of Bangladesh for the year 2015 (in billion dollars). Assume no transfer payment."
The info I am given:
C = 100+0.75 YDG = T =400, I = 200 and Xn= 300-0.15Y
What I'm stuck on:
-Calculate the value of equilibrium income.
-At equilibrium what is the amount of the budget deficit/surplus?
-Suppose government takes a fiscal policy of increasing both its spending (G) and autonomous taxes (T) by $80 billion. Calculate the new equilibrium income.
-Is this fiscal policy neutral?
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