3. Calculate the slope of the IS curve given the following two equations. (Hint: The IS curve is the relationship between Y and r, so you need to isolate Y on one side.) Ct = 0.6(Y; – Gt)+ 0.5(Y++1 – Gt+1) – 10rt It = -20rt + At+1 – 0.2K¢ Gt = Gt+1 = 10
3. Calculate the slope of the IS curve given the following two equations. (Hint: The IS curve is the relationship between Y and r, so you need to isolate Y on one side.) Ct = 0.6(Y; – Gt)+ 0.5(Y++1 – Gt+1) – 10rt It = -20rt + At+1 – 0.2K¢ Gt = Gt+1 = 10
Chapter1: Introducing The Economic Way Of Thinking
Section1.A: Applying Graphs To Economics
Problem 12SQ
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Transcribed Image Text:3. Calculate the slope of the IS curve given the following two equations. (Hint: The IS curve is
the relationship between Y and r, so you need to isolate Y on one side.)
C; = 0.6(Y; – Gi) + 0.5(Y;+1 – Gt+1) – 10rt
It = -20rt + At+1 – 0.2Kt
Gi = Gt+1
10
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