Question

2. Calculate equilibrium level of income from the following:
Consumption expenditure at zero income
( Marginal Propensity to Consume
() Investment

*40
0.8
* 30​

Answer 1

Answer:

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Explanation:

i have to also learn it

Answer 2

Answer:

ANSWER

Consumption Function, C = 40+ 0.8 Y where Y in the income in the economy. 

At equilibrium level of output,

 AS=AD

Y= C+I 

=> Y= 40 + 0.8 Y + 80

=> Y - 0.8 Y = 40 + 80

=> 0.2 Y = 120

=> Y = 120/ 0.2 = Rs. 600.