Re: jnu sis

Posted by aditi5000 on May 16, 2012; 3:21pm
URL: http://discussion-forum.276.s1.nabble.com/jnu-sis-tp7561861p7562021.html

2.consider the following aggregated demand sysytem:
Md=AD-r
Md/p=Ms/p
AD=C+I+G
C=1+0.5Y
I=1-0.5Y
derive is-lm equations.

IS -
Y = 1+0.5Y+1-0.5Y +G
SOLVE FOR Y

LM
(1+0.5Y+1-0.5Y +G-r)/p=Ms/p
solve for Y and get it in terms of r