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Prove that the overall supply of money is equal to the overall demand for money at the equilibrium level of interest rate (M/P)d = 4Y
Prove that the overall supply of money is equal to the overall demand for money at the equilibrium level of interest rate
(M/P)d = 4Y -12000i M/P = 3000
a. Derive the IS relation or equation.
Y = C(Y-T) + I+ G
b.Derive the LM relation or equation.
c.Solve for the equilibrium interest rate.
d.Solve for the equilibrium output.
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