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What is the output (y) when the government spending (g) and desired consumption (cd) are given?

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Final answer:

The output (y) can be calculated when the government spending (g) and desired consumption (cd) are given.

Step-by-step explanation:

The output (y) can be calculated when the government spending (g) and desired consumption (cd) are given. In this case, the economic parameters are the following:

  • Y = National income
  • T = Taxes = 0.3Y
  • C = Consumption = 200+ 0.9(Y – T)
  • I = Investment = 600

To calculate the output (y), you can use the equation:

y = C + I + G, where C is consumption, I is investment, and G is government spending.

Substituting the values from the economic parameters, we get:

y = (200 + 0.9(Y – T)) + 600 + g

Solving this equation will give you the value for the output (y).

User Zunan
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