a) Yd= Y - T
AE = C + I + G + (X - M)
AE = Y
Y=100+0,8(Y-T)+100+150-0,25(Y-T)
Y=100+0,6Y+100+150-0,1875Y
Ye=595,7 (the level of equilibrium national income)
b) Budget surplus is when X>M, otherwise (X<M) there is a budget deficit. So at the equilibrium national income there is a
surplus.
c) S = Y - C , where Saving = Income - Consumption
S = Y - (100 + 0,8Yd)
S = 138,26
d) k = 1/ (1 - MPC)
k = 4,3
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