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February 20, 2008

The Flexible-Price Full-Employment Medium-Run Model: Components of Aggregate Demand

  • C = C0 + C y(1-t)Y
  • I = I0 - Irr
  • G = G
  • NX = XfYf + Xee - IMyY

  • e = e0 - er(r-rf)

  • Y = C + I + G + NX

  • Y = Y*

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