Question: 5. Consider the following macro model with demand-determined output: C = 150 + 0.9, = 0.8Y, I = 400, G = 700, T = (0.2)Y,

5. Consider the following macro model with demand-determined output:

C = 150 + 0.9,

= 0.8Y,

I = 400,

G = 700,

T = (0.2)Y,

X = 130,

IM = (0.08)Y.

a)What is the equilibrium national income (GDP)?

b) What is the margin propensity to spendMPS in this case?

b)What is the value of the multiplier?

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