1. Suppose you have the following model:
Y= C + I + G
C= 200 + 0.8Y
m/p= -1000R + 0.1Y
where Y is national income; C, consumption; I, investment; G, Government Expenditure; R, the interest rate; and M/P, the real money supply. Derive the Y and R, national income based on the interest rate and another variable.
Y = 6 0 0 0 − 1 0 0 0 0 R + 5 G is the... View the full answer