a)
To calculate: The equilibrium
a)
Answer to Problem 8TY
The equilibrium level of GDP is derived as
Explanation of Solution
Substituting the values of rate of interest
in the investment function and the total investment is being calculated as follows:
The equilibrium level of GDP is derived as follows:
By bringing the variable
to the left hand side:
Therefore, the equilibrium level of GDP is
Introduction: The Gross Domestic Product (GDP) is the summation of market values, which includes the final services and goods for a period of time, in an economy.
b)
To Calculate: The equilibrium GDP.
b)
Answer to Problem 8TY
The equilibrium level of GDP is derived as
Explanation of Solution
Substituting the values of rate of interest
in the investment function and the total investment is being calculated as follows:
The equilibrium level of GDP is derived as follows:
By bringing the variable
to the left hand side:
Therefore, the equilibrium level of GDP is
Introduction: The Gross Domestic Product (GDP) is the summation of market values, which includes the final services and goods for a period of time, in an economy.
c)
To Calculate: The equilibrium GDP.
c)
Answer to Problem 8TY
The equilibrium level of GDP is derived as
Explanation of Solution
Substituting the values of rate of interest
in the investment function and the total investment is being calculated as follows:
The equilibrium level of GDP is derived as follows:
By bringing the variable
to the left hand side:
Therefore, the equilibrium level of GDP is
Introduction: The Gross Domestic Product (GDP) is the summation of market values, which includes the final services and goods for a period of time, in an economy.
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