How is a closed economy illustrated? Using a graph, how is a closed economy analyzed? How is closed economy applied?

Name: Intermediate Macroeconomics Notes Week #7
Brand: StudySoup
SKU: 158619
Price: 45.00 USD
Availability: InStock
Rating: 0 (1 reviews)

ECON 3020 Notes for Week #7 22 February 2016 The Closed Economy ● in a closed economy goodsmarket equilibrium occurs when S = I ● S = Y − C − G = I ● S = Y − (C + C(Y − T, r)) − G = I + I(r) = I S = Y − C − C(Y − T, r) − G = I + I(r) = I ● ● as r increases, C(Y − T, r) increases, so the S curve has a positive slope ● as r increases, I(r) decreases, so the I curve has a negative slope ● at r : 2 ○ there are excess savings ○ savers will accept a lower r in order to incentivize borrowers to borrow more ○ this will cause some savers to save less ● at r :