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Compute the equilibrium income

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Question - If the consumption function is C = 300 +.8(Yd), investment is $200, government spending is $200, t is 0.2, and X = 100 -.04Y then the equilibrium income is: (Hint: Use the equation 1/1-b(1-t) + m).

a. 6,000

b. 7,500

c. 4,000

d. 2,500

e. 2,000

Reference no: EM133183037

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