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For an economy with a tax rate of 10% the following expenditure functions are given C = 60 + 0.8Yd G 400 I 140 NX 10 0.20Y aAssume all taxes are collected Is the Government

For an economy with a tax rate of 10%, the following expenditure functions are given:
C = 60 + 0.8Yd
G = 400
I = 140
NX = 10 - 0.20Y
(a). Assume all taxes are collected. Is the Government experiencing a budget deficit in equilibrium? Why?
(b). Is the economy experiencing a trade deficit? Why?

May 26 2020 View more View Less

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