The following set of equations describe an economy: C= 15,000 + 0.75(Y – T) – 45,000r Ip= 10,000 – 22,500r G= 8,200 NX= 1,800 T= 8,500 Y*= 82,100 Find PAE equation and what should be the interest rate to eliminate the output gap.
The following set of equations describe an economy: C= 15,000 + 0.75(Y – T) – 45,000r Ip= 10,000 – 22,500r G= 8,200 NX= 1,800 T= 8,500 Y*= 82,100 Find PAE equation and what should be the interest rate to eliminate the output gap.
Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter14: Modern Macroeconomics And Monetary Policy
Section: Chapter Questions
Problem 11CQ
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The following set of equations describe an economy:
C= 15,000 + 0.75(Y – T) – 45,000r
Ip= 10,000 – 22,500r
G= 8,200
NX= 1,800
T= 8,500
Y*= 82,100
Find PAE equation and what should be the interest rate to eliminate the output
gap.
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