Answer to Question #162145 in Macroeconomics for Fatima

Question

Specifier the equation of the equilibrium of the goods and services

Answer 1

The equation of the equilibrium of the goods and services can be written as follows:

$$Y^d=Y=C^d+I^d+G_0,$$

here, $Y^d$ is the aggregate demand for goods and services, $Y$ is the aggregate supply of goods and services (or the real GDP), $C^d$ is the demand for consumption goods, $I^d$ is the demand for investment goods and $G_0$ is the government spending on goods and services.