The following equations apply to an economy c4009y-t, Ask an Expert

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The following equations apply to an economy: C=400+.9(Y-T) I=250-50r (M/P)d=Y-300r You also know that government spending and taxes are 500 and the nominal money supply is 4000. The price level is 2. Make sure you simplify your equations. a) Derive the IS equation. b) Derive the LM equation. c) Solve for the equilibrium of the IS-LM. What are the values of the real interest rate and income?

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Business Economics, Economics

Category:- Business Economics
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