Economics Quantitatively Treated :Simultaneous Equations Assignment
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- Subject Code :
EC4004
Economics Quantitatively Treated (EC4004) Exercise 12: Simultaneous Equations 2
- Solve the following sets of equations for Y (be careful to identify which variablesare exogenous and which are endogenous):
|
(a) E = Y |
(1.a.1) |
|
E = C + I |
(1.a.2) |
|
C = 0.8Y |
(1.a.3) |
|
(b) E = Y |
(1.b.1) |
|
E = C + I |
(1.b.2) |
|
C = 0.5Y |
(1.b.3) |
|
(c) E = Y |
(1.c.1) |
|
E = C + I |
(1.c.2) |
|
C = 100 + 0.5Y |
(1.c.3) |
|
(d) E = Y |
(1.d.1) |
|
E = C + I + G |
(1.d.2) |
|
C = 0.75Y |
(1.d.3) |
|
I = 0.1Y |
(1.d.4) |
- In the economy described by the set of equations (1.a.1) - (1.a.3), how much will GDP (Y) increase by if investment (I) increases by one unit?
- In the economy described by the set of equations (1.b.1) - (1.b.3), how much will GDP (Y) increase by if investment (I) increases by one unit?
- In the economy described by the set of equations (1.c.1) - (1.c.3), how much will GDP (Y) increase by if investment (I) increases by one unit?
- In the economy described by the set of equations (1.d.1) - (1.d.4), how much will GDP (Y) increase by if government expenditure (G) increases by one unit?
