Suppose an economy is described by the following equations: Y = C + I + G + X – M C = 14 + 0.60Yd I = 20 G = 20 X = 15 M = 5 +0.1Y T = 20 + 0.4Y Where Y is domestic income Yd is private disposable income C is aggregate consumption spending T is government tax revenue I is investment spending G is government spending E represents exports M represents imports of goods and services. (a) Find out the equilibrium value of income. (b) What is the value of export multiplier?
Suppose an economy is described by the following equations: Y = C + I + G + X – M C = 14 + 0.60Yd I = 20 G = 20 X = 15 M = 5 +0.1Y T = 20 + 0.4Y Where Y is domestic income Yd is private disposable income C is aggregate consumption spending T is government tax revenue I is investment spending G is government spending E represents exports M represents imports of goods and services. (a) Find out the equilibrium value of income. (b) What is the value of export multiplier?
Chapter20: Exchange Rates And The Macroeconomy
Section: Chapter Questions
Problem 3TY
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Suppose an economy is described by the following equations:
Y = C + I + G + X – M
C = 14 + 0.60Yd
I = 20
G = 20
X = 15
M = 5 +0.1Y
T = 20 + 0.4Y
Where Y is domestic income Yd is private disposable income C is aggregate consumption spending T is government tax revenue I is investment spending G is government spending E represents exports M represents imports of goods and services.
(a) Find out the equilibrium value of income.
(b) What is the value of export multiplier?
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