Question

C= 5 0.8Yd
Yd stands for disposable income
T= 0.25Y
G= 245
I= 750- 50i
i stands for rate of interest
L= 0.4Y- 5i
M= 500
P= 2

a) Find the equation of the Goods market

b) Find the equation of the Money market

c) Find the equilibrium level of Income and the Rate of interest

d) With the help of multiplier, find the change in equilibrium income if the government expenditure increases by 100.

e) How much of investment would be crowded out as a result of this increase in government spending of 100.​

Answer 1

Answer:

i don't know its confusion i