1. Economics 214 Lecture 13 Systems of Equations

2. Examples of System of Equations Demand and Supply IS-LM Aggregate Demand and Supply

3. Demand and Supply

4. IS-LM

5. Solving System of Equations Repeated Substitution Matrix Algebra or linear Algebra

6. Solving System of Equations Economic Models typically consist of a number of equations that represent identities, behavioral relationships, and conditions that constitute an equilibrium. These equations include both variables, which are economic quantities and parameters, which are unvarying constants.

7. Solving Systems of Equations Variables in a system are exogenous if determined outside the system or endogenous if the are determined within the system. A solution to the model is a representation of the endogenous variables as functions of only the parameters of the model and the exogenous variables.

8. Solving our Demand and Supply model

9. Solving our Demand & Supply Model

10. Solving our IS-LM Model