Q4. Consider the national - income modelwhere goods can be produced locally orimported. Local consumers, investors andgovernment in addition to foreign countriesare the main customers to these goods.Further, government and external demandsfor goods and services are considered fixed.Investment and imports depend positively onincome linearly and private consumption isalso depending on private income.1. Write the system .2. Find the exogenous and endogenousvariables in the above model.3. Solve the model

A two-sector model and the government sector make up a three-sector model of income determination.…

Answered: 1. Write the system . 2. Find the…

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1. Write the system . 2. Find the exogenous and endogenous variables in the above model. 3. Solve the model

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

ChapterD: The Expenditure-output Model

Section: Chapter Questions

Problem 25CTQ: Exercise D25 What role does government play in stabilizing the economy and what are the tradeoffs...

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