Given the following equations from the Keynesian Cross Model (fixed prices, no asset market): I C = 100 + 0.8 (Y-T) (Consumption Function) II. T = -600 + 0.4 Y (Taxes) III. I = 100 + 0.22 Y (Private Investment) IV. G = 430 (Government Spending) V. X = 400 (Exports) VI. M = 200 + 0.1 Y (Imports) V. Y = C + I + G + X – M = C + S + T (Goods Market Equilibrium) a) Solve for Y in equilibrium. b) If the equilibrium GDP level you calculated in part A is 200 units below full employment level, what policy measures could be taken by the government to reach full employment? By ho

Question

Given the following equations from the Keynesian Cross Model (fixed prices, no asset market):  I	C = 100 + 0.8 (Y-T)			(Consumption Function) II.	T = -600 + 0.4 Y			(Taxes) III.	I = 100 + 0.22 Y			(Private Investment) IV.	G = 430				(Government Spending) V.        X = 400				(Exports) VI.	M = 200 + 0.1 Y			(Imports) V.	Y = C + I + G + X – M = C + S + T	(Goods Market Equilibrium)  a) Solve for Y in equilibrium.   b) If the equilibrium GDP level you calculated in part A is 200 units below full employment level, what policy measures could be taken by the government to reach full employment? By ho