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03-02-2009 85619 PM

# 03-02-2009 85619 PM - of national income ~T)VC>f d...

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Suppose in an economy that involves government and international trade, following information is provided: C = 50 + 0.7Y D T = (0.2)Y I = 75 G = 100 X = 50 IM = (0.06)Y a. Compute the AE function and state what is total ^ expenditure? Y»-Y-T 9 b. '• What is the slope of the AE function? dope o| -i-k c. Compute the equilibrium level
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Unformatted text preview: of national income. \\ ~T)VC >f d. Suppose X rises from 50 to 100. How does this affect the level of national income (calculate the new level of equilibrium national income)? r So e. What is the simple multiplier in this model? m-r~ C l-f-)-{...
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