1. Consider the following simple Keynesian model,(i) Rewrite the model into matrix form with Y, C and I as endogenous variables and Go and i asexogenous variables. (The coefficient matrix must be a 3 by 3 matrix.)Y=C+I+GoC = 200+ 0.8YI= 1000-2000(ii) Compute the equilibria Y*, C* and I* as functions of Go and i using Cramer's rule.8Y*(iii) Find anddiƏY*ƏGo(iv) Give an economic interpretation ofnational income?ƏY*"ƏGowhat should the government do if it wants to raise

Cramer's model typically refers to Cramer's rule, which is a mathematical technique used to solve…

1. Consider the following simple Keynesian model, Y=C+I+Go C = 200+ 0.8Y I = 1000-2000 (i) Rewrite the model into matrix form with Y, C and I as endogenous variables and Go and i as exogenous variables. (The coefficient matrix must be a 3 by 3 matrix.) (ii) Compute the equilibria Y, C and I as functions of Go and i using Cramer's rule. ƏY* ƏY (iii) Find and ƏGo di (iv) Give an economic interpretation of national income? ay* Go 1 what should the government do if it wants to raise

1. Consider the following simple Keynesian model, Y=C+I+Go C = 200+ 0.8Y I = 1000-2000 (i) Rewrite the model into matrix form with Y, C and I as endogenous variables and Go and i as exogenous variables. (The coefficient matrix must be a 3 by 3 matrix.) (ii) Compute the equilibria Y, C and I as functions of Go and i using Cramer's rule. ƏY* ƏY (iii) Find and ƏGo di (iv) Give an economic interpretation of national income? ay* Go 1 what should the government do if it wants to raise

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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