Question: A simple macroeconomic system is described below. Assuming the system follows the aggregate expenditures model, please answer the questions that follow. C = Co +

A simple macroeconomic system is described below. Assuming the system follows the aggregate expenditures model, please answer the questions that follow.

C= Co + cYa

Co = 760

с = 0.7

Ya = Y - NT

NT = tY

1= 0.2

0 = 230

Go = 570

Хо = 90

M = IMo + mY

IMo = 140

m = 0.35

C = consumption expenditure

Co = autonomous consumption expenditure

c = marginal propensity to consume (MPC)

Ya = disposable income

NT = net taxes

t= tax rate

lo = investment expenditure

Go = government expenditure

Xo = exports

IM = imports

IMo = autonomous imports

m = marginal propensity to import (MPM)

Y = real GDP/income

Calculate the equilibrium level of income. Keep as much precision as possible during your calculations. Your final answer should be accurate to the nearest dollar.

Equilibrium = SO

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