Consider following static IS-LM model: IS : Y = C(Yd) + I (r) + G ...
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Consider following static IS-LM model:
IS : Y = C(Yd) + I (r) + G
Consumption : C(Yd) = 100 + 0.75 Yd
Disposable income : Yd = Y – Tx
Investment : I (r) = 200 – 2 r
LM : M/P = L(Y, r)
Real money demand : L(Y, r) = 300 + 0.5 Y – 5 r
Money supply : Ms = M
What
is the value of taxes multiplier?
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