a.) What is the value of the MPC?
b.) Derive the equation for the planned aggregate expenditure
function (i.e. solve for the value of the slope and
intercept).
c.) What is the value of income-expenditure equilibrium GDP
(Y*)?
d.) Show the income-expenditure equilibrium for this economy on
a diagram (with real GDP on the x-axis and
AEPlanned on the y-axis).
GDP YD AE Planned I Unplanned $ 0 400 800 1,200 1,600 $ 0 400 800 1,200 1,600 С I Planned (Billions of dollars) $ 200 $ 100 500 100 800 100 1,100 100 1,400 100 $ 600 900 1,200 1,500 $ -200 -100 0 100
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