Solutions Economics

The economy of Florin is given by the equations: Y = C + I + G C = 250 + .8*Yd Yd = Y - T I = 50 G =

Question: The economy of Florin is given by the equations:

Y = C + I + G

C = 250 + .8*Yd

Yd = Y – T

I = 50

G = 100

T = 100

a. What is equilibrium GDP?

b. What is the government spending multiplier? What is the tax multiplier? Why do they differ?

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Solution: The answer consists of 2 pages
Type of Deliverable: Word Document


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