What is the lm and is curve, Basic Statistics

Consider an economy specified by the following:

      Y = PE = C + I + G + NX                            (Income identity)

      C = 400 + 0.9YD                                      (Consumption)

      I = 200 - 1,800i                                        (Investment)

NX = 200 - 0.1Y - 200i                                      (Net exports)

MD = (0.8Y - 3,000i)                                       (Money demand)

Also assume that government spending G = $200, the tax rate t = 0.3333, and the money supply MS = $1,104 (and assume the price level is constant at P = 1).

a.  What is the IS curve?

b.  What is the LM curve?

c.  What are the values of income (Y) and the interest rate (i) when the IS-LM model is in equilibrium?

 

 

Posted Date: 2/21/2013 8:11:15 AM | Location : United States







Related Discussions:- What is the lm and is curve, Assignment Help, Ask Question on What is the lm and is curve, Get Answer, Expert's Help, What is the lm and is curve Discussions

Write discussion on What is the lm and is curve
Your posts are moderated
Related Questions
need to define one statistic and calculate value

Q. CRSL has a large auditorium which can cater for 300 people and is ideal for formal balls and functions. The auditorium can also be reconfigured to cater for 100 people. The Sea

what is the basic difference between seasonal variation and cyclical variation

Two researchers test the same hypothesis. Researcher A rejects the null hypothesis and researcher B fails to reject the null hypothesis.  Discuss three reasons that could cause the

1. Stock A and B have the following probability distributions: ECONONOMY                    PROBABILITY                      K(A)                       K(B) Boom

Shafts are cut to length by two machines, A and B. Each machine cuts 50 percent of all shafts in approximately the same amount of time. Machine A's shafts are all good, but Machine

Accounting Standards in  Canada:  : In 2005, the Accounting Standards Board in Canada promoted the use of IFRS over the use of GAAP. The companies of Canada are supposed to ad


The square of the sample correlation coefficient is typically denoted r2 and called the coefficient of determination. It estimates the fraction of the variance in Y that is explain

1. Suppose that a population has mean, µ, and standard deviation, σ. What does the central limit theorem tell us about the distribution of the sample mean?