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Need of help for C only. Y=C+I+G+NX Y=5000 G=1000 T=1000 C=250+0.75(Y-T) 1=1000-50r NX-500-500E r=r*=5 a.) In this economy, solve for national saving, investment, the trade
Need of help for C only.
Y=C+I+G+NX Y=5000 G=1000 T=1000 C=250+0.75(Y-T) 1=1000-50r NX-500-500E r=r*=5 a.) In this economy, solve for national saving, investment, the trade balance, and the equilibrium exchange rate. National saving is given by: b.) Now suppose that the world interest rate rises from 5 to 10 percent. Solve for the national saving, investment, the trade balance and the equilibrium exchange rate, Explain what you find. Repeating the same steps with the new interest rate, S=Y-C-G = 5,000- (250 + 0. 75 (5,000- 1,000))- 1,000 = 750 1 = 1,000 - 50* 10 = 500 NX=S-I = 750-500 =250 NX = 500 - 500*&=250 So E= 0.5 c.) Draw a graph that shows the change in equilibrium real exchange rate and net exports brought by the increase in the world interest rateStep by Step Solution
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