Question: Q) SUPPOSE: Consumption function: C =200+ 0.75Yd Investment: I = 250 Government spending: G = 250 Net taxes: T = -80 + 0.2Y Find: a)

 Q) SUPPOSE: Consumption function: C =200+ 0.75Yd Investment: I = 250

Q) SUPPOSE: Consumption function: C =200+ 0.75Yd Investment: I = 250 Government spending: G = 250 Net taxes: T = -80 + 0.2Y Find: a) The equilibrium income (Y). b) The Multiplier. c) Find the tax multiplier. d) If Government spending increased by 100. Find the new equilibrium income (Y). e) If Government spending increased from 200 to 400. Find the new equilibrium income (Y)

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