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Question 4 Suppose the country of KU opens-up to international trade, but still has no government sector. Now it can be described by the follow-
Question 4 Suppose the country of KU opens-up to international trade, but still has no government sector. Now it can be described by the follow- ing equations. C = 200 + 0.6Y TH = 80 X = 60 M = 0.1Y (a) What is the magnitude of the marginal propensity to import? (0.1) (b) Calculate equilibrium GDP. (Y = 680) (c) Calculate equilibrium consumption and imports ( C. = 608, M' = 681 (d) What is the value of net exports in equilibrium? (NX = -8) (e) What is the magnitude of the multiplier in KU? (2.0) (f) In the two-sector model we could write the condition for equi- librium in terms of saving and planned investment. What would
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