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  • Ejercicio de Una Economia Cerrada Is-Lm

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    Corina Proaño
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    The document contains equations to solve for the equilibrium level of income (Y) and interest rate (i) in an economy. It first sets up an income-expenditure model to relate Y to its components of consumption (C), investment (I), government spending (G), and taxes (T). This gives an initial solution for Y in terms of i. It then sets up a loan market model to relate the supply of loans (L) to the demand for loans (M) and solves to get a second equation for Y in terms of i. Equating the two expressions for Y yields an expression to solve for the equilibrium interest rate i, which is found to be 0.1875. Plugging this back into

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    Ejercicio de Una Economia Cerrada is-lm

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    The document contains equations to solve for the equilibrium level of income (Y) and interest rate (i) in an economy. It first sets up an income-expenditure model to relate Y to its components of consumption (C), investment (I), government spending (G), and taxes (T). This gives an initial solution for Y in terms of i. It then sets up a loan market model to relate the supply of loans (L) to the demand for loans (M) and solves to get a second equation for Y in terms of i. Equating the two expressions for Y yields an expression to solve for the equilibrium interest rate i, which is found to be 0.1875. Plugging this back into

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    0 views3 pages

    Ejercicio de Una Economia Cerrada Is-Lm

    Uploaded by

    Corina Proaño
    The document contains equations to solve for the equilibrium level of income (Y) and interest rate (i) in an economy. It first sets up an income-expenditure model to relate Y to its components of consumption (C), investment (I), government spending (G), and taxes (T). This gives an initial solution for Y in terms of i. It then sets up a loan market model to relate the supply of loans (L) to the demand for loans (M) and solves to get a second equation for Y in terms of i. Equating the two expressions for Y yields an expression to solve for the equilibrium interest rate i, which is found to be 0.1875. Plugging this back into

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 3

    C=200 + 0.

    25yd
    I=100+ 0.25y – 1200i
    G= 400
    T=300
    L= 5y – 8000
    2
    M
    =250 0
    P

    (IS) Y= C+ I+G
    Y= 200 + 0.25(Y-300) + 100 + 0.25Y - 1200i + 400
    Y= 200 + 0.25Y – 75 + 100 + 0.25Y – 1200i + 400
    Y= 625 + 0.50Y – 1200i
    Y – 0.50Y = 625 – 1200i
    0.50Y = 625 – 1200i
    Y = 1250 – 240i (IS)
    S
    M
    (LM) P
    =L(i ,Y )

    2500 = 5Y – 8000 i
    5Y = 2500 + 8000 i
    2500 8000
    Y= 5
    +
    5 i
    Y = 500 + 1600 i (LM)

    (IS) Y = 1250 – 2400 i


    (LM) Y = 500 + 1600 i

    1250 – 2400 i = 500 + 1600 i


    1250 – 500 = 1600i + 2400i
    750 = 4000i
    750
    i= 4000
    =0.1875

    Y = 500 + 1600 i
    Y = 500 + 1600 (0.1875)
    Y = 500 + 300
    Y = 800

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