Final answer:
The short-run equilibrium output in an economy with zero net exports is 650.
Step-by-step explanation:
The given equations represent an economy with zero net exports. To find the short-run equilibrium output, we need to determine the value of Y (national income) when its value is equal to aggregate expenditure (AE). Substituting the given values into the equation:
Y = AE = C + I + G + NX
Y = 40 + 0.8(Y - T) + 70 + 120 + 0
Y = 40 + 0.8(Y - 150) + 70 + 120
Y = 40 + 0.8Y - 120 + 70 + 120
0.2Y = 130
Y = 650
Therefore, the short-run equilibrium output is 650.