Consider an economy described by the following:
C=$3.2trillion
f=0.5
I=$1.3trillion
mpc=0.75
G=$2.8trillion
d=0.4
T=$3trillion
x=0.15
NX=$-0.5trillion
A. The simplified expression for the investment function is:
B. The simplified expression for the consumption function is:
C. The simplified expression for the net export function is:
D. An expression for the IS curve is:
E. If the real interest rate is r=1, equilibrium output Ye ____ trillion. (Round your response to one decimal place.)
F. If the real interest rate is r=4, equilibrium output Ye ____ trillion. (Round your response to one decimal place.)
G. If government purchases increase to $3.5 trillion and the real interest rate r=1, equilibrium output Ye_______trillion. (Round your response to one decimal place.)
H. If government purchases increase to $3.5 trillion and the real interest rate r=4, equilibrium output Ye______trillion. (Round your response to one decimal place.)