5 pts Question 1
Calculate the following (show your work):
A. The equilibrium price of a bond that pays three coupon payments of $1,000 each
for the next 3 years and the principal of $5,000 three years from now. If the interest
rate is 6%. (2)
B. The national saving in the economy described by the following equations (3)
o real GDP = $2,000
aggregate consumption C = $200 +0.75Y
onet tax T = $400
government purchase of goods and services G = $300
o
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