Determine the equilibrium level of income in winterland

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Reference no: EM131271309

Consider the following set of equations for the economy of Winterland C = 300 + 0.75Y, I = 250, G = 350

(a) Determine the equilibrium level of income in Winterland

(b) What is the formula for the Government multiplier and what is its value ?

(c) Use the multiplier to calculate the impact on Winterland GDP from an increase in government spending of 150 units.

(d) Capture the above information in a neat labeled graph.

Reference no: EM131271309

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