Find an equation relating desired national saving

Reference no: EM133425879

Question: Consider all econofly with luff-employment output of o JUU and govelimfileIll purchases G of 1,200. Desired consumption and desired investment are: Cad= 3600 - 2000r + 0.10Y , and = 1200 - 4000r . where Y is output and r is the real interest rate. (i) Find an equation relating desired national saving S to r and Y. (ii) Find the real interest rate that clears the goods market. Assume that output equals full-employment output.

Reference no: EM133425879

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