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    Question

    When C = 200 + 0.75(Y − T), I = 200 − 25r, G = 100, T = 100. Find IS curve function.

    A Y = 1700 − 100r Correct Answer Incorrect Answer
    B Y = 1800 − 100r Correct Answer Incorrect Answer
    C Y = 1900 − 100r Correct Answer Incorrect Answer
    D Y = 1700 + 100r Correct Answer Incorrect Answer
    E Y = 1700 - 20r Correct Answer Incorrect Answer

    Solution

    For IS curve, goods market is in equilibrium so equate AD = AS to get the equation. 200 + 0.75(Y-100) +200-25r + 100 = Y Y = 1700 − 100r

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