derive of the IS equation using the expenditure approach and assuming the absence of government.

      

Derive the IS equation using the expenditure approach and assuming the absence of government.

  

Answers


Dana
Y=C + I
Y=a+ ßY +Io - kr
Y- ßy= a + Io – kr
(1 – ß) Y = a + Io – kr
kr = a + Io - (1 – ß ) Y
r = (a + Io - (1 – ß) Y)/k
r = (a + Io)/k - (1 – ß) Y/k

Dana05 answered the question on July 18, 2019 at 19:54


Next: Describe the life cycle income hypothesis of consumption
Previous: What factors cause a shift in the IS curve

View More Economics Questions and Answers | Return to Questions Index


Exams With Marking Schemes

Related Questions