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Solve the following macroeconomic model wherein;
Y = C + I + G + NX is the equilibrium condition in macroeconomic model
C = 1,000 + 0.65Y consumption function ( C = C0+cYd), where c is MPC
I = 1,500 planned investment function
G ,500 government purchases function
NX = -500 net export function
1- Find the value of Real GDP (Y) by solving above macroeconomic model? 2- If the value of Marginal Propensity to Consume (MPC) increases fromc .65 to c = 0.75, then how it will affect the Real GDP (Y) in the economy?
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