macro
posted by greg on .
I need help with this question and am a student here. Can you PLEASE show me how to do this??
QUESTION
Consider an economy described by the following equations:
Y=C+I+G
Y=500
G=1,000
T=1,000
C=250+0.75(YT)
I=1,00050r
a.In this economy, compute private saving, public saving, and national saving.
b. Find the equilibrium interest rate.
c. Now suppose that G rises to 1,250. Compute private saving, public saving,
and national saving.
d. Find the new equilibrium rate.

a. Private saving= 750; Public saving=0; National saving=500
b. r=5
c.At the new equilibrium The new Private saving= 1000; Public saving=250; National saving=750
d.The new equilibrium interest rate=5 (same)