Jharsh5929 Jharsh5929

25-05-2023
Business

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Consider the open economy IS/LM model with the following functions: C=0.5(Y—T), I = 1500-250r, NX = 1000-250e, L(Y,r) = 0.5Y - 500r (money demand), CF = 500-250r. Taxes, government purchases, the money supply, and price level are T= 1000, G = 1500, M = 1000, and P= 1. Calculate the equilibrium values for GDP Y, the interest rate r, consumption C, investment I, net capital outflow CF, net exports NX, and the exchange rate e.

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