The equilibrium level in the economy is derived from the IS And LM curve equilibrium position.
Y=C+I+G
Y=0.8(1−0.25)Y+900−50i+800
Y=0.6Y+1700−50i
Y=0.25(1700−50i)
Y=4250−125i (for IS curve equilibrium)
For LM curve equilibrium ;
0.25Y−62.5i=500
Y=2000+250i
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