Question

Y=C+Y+G C=Co+by,I=10,G=Go Co=135 find equation of equilibrium and equilibrium level of income

Answer 1

C= 300 + .75(DI)

[Consumption is dictated by discretionary cashflow.) E=C+I+G+NX]

[Aggregate request is the aggregate of utilization, speculation, government buys, and net exports.]

E=Y* [In balance, all out spending matches all out salary or absolute output.]

Calculate the balance dimension of GDP for this economy (Y*).

Most basically, the equation for the harmony dimension of salary is when total supply (AS) is equivalent to total interest (AD), where AS = AD.