IN a closed economy,The price level is fixed at 1. The money supply is 100. c= consumer expenditure; i=investment; g= government spending; t=taxes; r= interest rate; Md=demand for money; P= price level; y= real GDP.1. Calculate the equilibrium levels of interest rate and real GDP. 2. Calculate the equilibrium level of consumer expenditure. 3. Calculate the equilibrium level of investment.

IN a closed economy,The price level is fixed at 1. The money supply is 100. c= consumer expenditure; i=investment; g= government spending; t=taxes; r= interest rate; Md=demand for money; P= price level; y= real GDP.1. Calculate the equilibrium levels of interest rate and real GDP. 2. Calculate the equilibrium level of consumer expenditure. 3. Calculate the equilibrium level of investment.

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter9: Demand-side Equilibrium: Unemployment Or Inflation?

Section9.A: The Simple Algebra Of Income Determination And The Multiplier

Problem 4TY

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