Question

When C = 200 + 0.75(Y − T), I = 200 − 25r, G = 100,

For IS curve, goods market is in equilibrium so equate AD AS to get the equation. 200 0.75Y-100 200-25r 100 Y Y 1700 100r

T = 100. Find IS curve function.

A Y = 1700 − 100r

B Y = 1800 − 100r

C Y = 1900 − 100r

D Y = 1700 + 100r

E Y = 1700 - 20r

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