Problem
Assume an economy is described by the following economic parameters:
C = 0.8YD
YD = Y + TR - tY
TR = 100
t = 0.3
I = 1000 - 65i
G = 600
L = 0.25Y - 75i
M/P = 600
What is the equation that describes the IS curve?
What is the general definition of the IS curve?
What is the equation that describes the LM curve?
What is the general definition of the LM curve?
What are the equilibrium levels of output and interest rates in this economy?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.