Investment demand function changes

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Reference no: EM131393407

AE = C + I + G + (X-M)

C = 800 + .75(Y – T) - 30 (r)

I = 600 – 50(r)

G = 300

X- M = -25

T = 80

r = 5

Price level P is fixed at 1 (P=1)

Suppose the investment demand function changes and is now I=700 – 50(r).

1. The new value of equilibrium output is

Reference no: EM131393407

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