Question: Can you help me understand this question? Consider the simplest macro model with demand-determined output. The equations are: C = 150 + 0.8 Yd ,

Can you help me understand this question?

Consider the simplest macro model with demand-determined output.

The equations are:

C= 150 + 0.8Yd,Yd = Y-T,

I= 400,G= 700,

T= .2Y,X= 130, and

IM= 0.14Y.

  1. What is the Marginal Propensity to Consume (MPC) in this model?
  2. What is the Marginal Propensity to import?
  3. What is the total autonomous expenditure?
  4. What is the equilibrium GDP?

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