Q3. An economy has full-employment output of 5000. Government purchases are 1000. Desired consumption and desired investment are given by
C^d=3000-2000r+0.10y
r^d =1000-4000r
where Y is output and r is the real interest rate. The real interest rate that clears the goods market is equal to(36).

Y=C+I+G5000=3000-200...