Goods Market: C = 200 + 0.25(Y-T) I = 150 + 0.25Y - 1000r G = 400
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Question:
Goods Market:
- C = 200 + 0.25(Y-T)
- I = 150 + 0.25Y - 1000r
- G = 400
- T = 200
Money Market:
- (M/P)d= 2Y - 8000r
- M/P = 1600
Solve for Y, r, C and I and then summarize the effects of fiscal policy on these variables using words.
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