Question: iven the data below solve a-g AD = C + I + G + NX I = 600 - 10i M = 800 S =

iven the data below solve a-g

AD = C + I + G + NX I = 600 - 10i M = 800

S = -200 + (1/5)YD G = 420 P = 1

YD = Y - TA NX = - 20 md = (1/4)Y + 100 - 15 i

TA = (.20)Y

  1. Solve for the equilibrium level of Y and i
  2. Solve for the equilibrium level of YD
  3. Solve for the equilibrium level of C
  4. Solve for the equilibrium level of S
  5. Solve for the equilibrium level of I
  6. What will be the level of crowding out if G increases by 100?
  7. Using the ISLM model graph an increase in government spending. Explain each step in the adjustment process

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