Given the keynessian model: Y=C+I+G+X WHERE C=30+0.8Yd;Yd=Y-T;I=60, T=50;G=50, X=50-0.0.5;X=IS NET EXPORT 1.FIND THE EQUILIBRIUM NATONAL INCOME. 2.FIND THE NET EXPORT BALANCE AT THE EQUILIBRIUM NATIONAL LEVEL OF INCOME. 3 WHAT HAPPENS TO EQUILIBRIUM NATIONAL INCOME AND THE MET EXPORT BALANCE WHEN NET IMVESTMENT INCREASE FROM 60 TO 70? 4. EXPLAIN WHAT HAPPENS TO EQUILIBRIUM NATIONAL INCOME AND NET EXPORTS FUNCTION CHANGE TO 40-0.05Y.

answer: in the short-run firms will respond by raising the price of turkey.

explanation: initially the long-run equilibrium is at a price of $5 per pound of turkey and a quantity of 50 million pounds per year. now, when webmd claims that a protein found in turkey will increase your expected lifespan by 4 years. the consumers demand for turkey will increase at every price shifting the demand curve to the right from d1 to d2. while, there will be no change in the supply curve in the short-run as it is not possible for producers to adjust supply so quickly. as a result the new equilibrium will occur at a higher price and a higher quantity of turkey.

thus, in the short run firms will respond by increasing the price of turkey, selling more quantity at a higher price and earning economic profits.