According to the keynesian-cross analysis

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1. Write down the IS and the LM equation. Explain why the IS curve is downward sloping and the LM curve is upward sloping.

2. According to the Keynesian-cross analysis, if the marginal propensity to consume is 0.8, and government expenditures and autonomous taxes are both decreased by 100. Calculate the change in income as a result of these changes.

Reference no: EM131096550

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