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Suppose that for a particular economy and period,investment was equal to 100,government expenditure was equal to 75, net taxes was fixed at 100,and consumption was given by consumption function c=25+0.8Yd where Yd is the disposable income and Y is GDP?

a. what is the level of equilibrium income Y?
b.what is the value of government expenditure multiplier

Microeconomics, Economics

  • Category:- Microeconomics
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