The economy is described by the following equations: Y=C+1+G(no trade) Y 5000 G 1000 T 1000 5000- 250+.15Y 75 T lo00-5or 1000 250 3150 150 000 50r +100p 509% 5250 -5or -Sobo 5000 +50 r =250 S 0 C = 250 + .75*(Y-T) 1000-50r r-5 Consider the economy in Box 1. The equilibrium real interest rate is 0 b))5 c) 10 d) 15 e) 20

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