Question

Based on the IS curve and LM curve you have derived in Q36 and Q37, what is the equilibrium income?

A 560.9 Correct Answer Incorrect Answer
B 660.7 Correct Answer Incorrect Answer
C 760.9 Correct Answer Incorrect Answer
D 760.7 Correct Answer Incorrect Answer
E None of the above Correct Answer Incorrect Answer

Solution

By equating the IS and LM equations: 

Y*=1065/1.4=760.7

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