Given the following economic information for Country A (in RM billion): Saving (S) = –500 + 0.3Yd Investment (I) = 400 – 200r Government spending (G) = 500 Taxes (T) = 200 Nominal money supply (Ms ) = 4000 Money demand for transactions (Md t/P) = 0.2Y Money demand for speculations (Md s) = 1600 – 500r Price (P) = 2 di mana Y dan r adalah masing-masing mewakili tingkat pendapatan dan kadar bunga. where Y and r represent the levels of income and interest rate, respectively. Based on the above information, i) . Derive an expression for the IS and LM curve (four decimal point) in Y says. ii) . Calculate the equilibrium levels of income and interest rate (three decimal point).
Given the following economic information for Country A (in RM billion): Saving (S) = –500 + 0.3Yd Investment (I) = 400 – 200r Government spending (G) = 500 Taxes (T) = 200 Nominal money supply (Ms ) = 4000 Money demand for transactions (Md t/P) = 0.2Y Money demand for speculations (Md s) = 1600 – 500r Price (P) = 2 di mana Y dan r adalah masing-masing mewakili tingkat pendapatan dan kadar bunga. where Y and r represent the levels of income and interest rate, respectively. Based on the above information, i) . Derive an expression for the IS and LM curve (four decimal point) in Y says. ii) . Calculate the equilibrium levels of income and interest rate (three decimal point).
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Given the following economic information for Country A (in RM billion):
Saving (S) = –500 + 0.3Yd
Investment (I) = 400 – 200r
Government spending (G) = 500
Taxes (T) = 200
Nominal money supply (Ms ) = 4000
Money demand for transactions (Md t/P) = 0.2Y
Money demand for speculations (Md s) = 1600 – 500r
Price (P) = 2 di mana Y dan r adalah masing-masing mewakili tingkat pendapatan dan kadar bunga.
where Y and r represent the levels of income and interest rate, respectively. Based on the above information,
i) . Derive an expression for the IS and LM curve (four decimal point) in Y says.
ii) . Calculate the equilibrium levels of income and interest rate (three decimal point).
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