Obtain the equilibrium budget balance

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Reference no: EM13339757

Suppose that the national income is described by the following equations:

Y = C + Io + G

C = a + b(Y - To)

G = d - gY

 

1. Set up the system of equations in matrix form.

2. Solve the system of equations to obtain the equilibrium vales of Y, C and G

3. Obtain the equilibrium budget balance

Reference no: EM13339757

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