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Assume that C = XXXXXXXXXXY - T), Id = 4, G = 0 and T = 1.What is the equilibrium value of income (Y*)?

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Assume that C = XXXXXXXXXXY - T), Id = 4, G = 0 and T = 1.What is the equilibrium value of income (Y*)?
Answered Same Day Dec 22, 2021

Solution

David answered on Dec 22 2021
121 Votes
Assume that C = 5 + 0.9 (Y - T), Id = 4, G = 0 and T = 1.What is the equili
ium value of
income (Y*)?
Y=C+I+G
=5+0.9(Y-1)+4+0
=5+0.9Y-0.9+4
0.1Y=9
0.1Y=9
Y=90
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