# Assume an economy is characterised by the following equations: c=200+.8(y-t), I=400-20r, (M/P)^d=Y-100r,?

M=4000

P=2

G=300

T=200

What is the equations for the IS and LM curves? Wat are the equilibrium levels of output and interest rate?

LM=(M/P)

IS=200+.8(y-t)+400-20r

Y=3700-100r (IS equation)

r=(Y/100)-40 (LM equation)

I tried to calculate everything, but the numbers didn't look right.

1. To get the IS equation. Y=C+I+G.

2. To get the LM equation. set (M/P)^d=(M/P)^s

3. To get Equilibrium output of Y. Plug the LM equation into the IS equation

4. To get the Interest rate. Plug Equilibrium out put of Y into the LM equation.

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P=2

G=300

T=200

What is the equations for the IS and LM curves? Wat are the equilibrium levels of output and interest rate?

LM=(M/P)

IS=200+.8(y-t)+400-20r

**Answer:**Y=3700-100r (IS equation)

r=(Y/100)-40 (LM equation)

I tried to calculate everything, but the numbers didn't look right.

1. To get the IS equation. Y=C+I+G.

2. To get the LM equation. set (M/P)^d=(M/P)^s

3. To get Equilibrium output of Y. Plug the LM equation into the IS equation

4. To get the Interest rate. Plug Equilibrium out put of Y into the LM equation.

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