(Advanced analysis)Answer the question on the basis of the following information for a private closed economy. $\begin{array} { l } S = - 20 + 0.4 Y \ I _ { g } = 25 - 3 i \end{array}$ where S is saving,I_g is gross investment,i is the real interest rate,and Y is GDP. Refer to the information.If the real interest rate is 5 (percent),investment will be: A) $10 and the equilibrium GDP will be $75. B) $15 and the equilibrium GDP will be $100. C) $10 and the equilibrium GDP will be $120. D) $15 and the equilibrium GDP will be $180.

Question

Quizplus · Accepted Answer

When i = 5, I_g = 25 - 3(5) = 10. Equilibrium GDP is found by setting S = I_g: -20 + 0.4Y = 10, so Y = 75.

(Advanced Analysis)Answer the Question on the Basis of the Following S=−20+0.4YIg=25−3i\begin{array} { l } S = - 20 + 0.4 Y \\I _ { g } = 25 - 3 i\end{array}S=−20+0.4YIg​=25−3i​

(Advanced Analysis)Answer the Question on the Basis of the Following $\begin{array} { l } S = - 20 + 0.4 Y \\I _ { g } = 25 - 3 i\end{array}$