Question

How does equilibrium level of income is determined which factors do change in the national income

Answer 1

The effective demand is the level of aggregate demand also known as aggregate expenditure which is effective in determining the  equilibrium level of income due to the fact that it is equal to aggregate supply of output

The level of the national income is therefore determined by and equal to the effective demand.

Answer 2

Explanation:

The calculation of equilibrium level of income depends on the aggregate supply and demands of the consumers. The government, investors, consumers and the business influence the equilibrium level. The equal amount of demands and the supply in the business is taken as the equilibrium. At this point, the business person becomes able to sell all the products pr complete service to the consumers.