Question
Q# 2. Suppose you have the following information about a closed economy: C = 50 + 0.80 Y I =150 G = 175 Where C
Q# 2. Suppose you have the following information about a closed economy: C = 50 + 0.80 Y I =150 G = 175 Where C is consumption, I is investment, G is Government expenditure and Y is income.
a.Find out the equilibrium level of income.
b.Suppose I increases to 210 what is the new equilibrium level of income?
c.What level of G is needed to achieve a target income of 4850?
And also calculate GDP if Consumption (C) 310 Investment (I) 115 Government purchases (G) 60 Exports (X) 305 Imports (M) 245.
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Historical Perspectives On The American Economy Selected Readings
Authors: Robert Whaples, Dianne C Betts
1st Edition
0521466482, 9780521466486
