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Closed Economy Assignment | Custom Assignment Help

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Fantasy Island is a closed economy and is characterized by the following equations: Consumption: C = 400 + 0.80(Y – T)            Investment: I = 300 – 1500r            Government spending: G = 300            Taxes: T = 400            Real money demand: L = 0.4Y – 498i            Expected inflation: pe = 0            Production function: Y = K1/2L1/2            The nominal money supply = 707 Note: Interest rates, i and r, …

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