Question

suppose the level of planned investment planned in economy is 200 and saving function is given s=80+0.25y find the equilibrium level of national income

Answer 1

Answer:

At equilibrium, S= I

80 + 0.25 y = 200

0.25 y = 120

y = 120/ 0.25

y = 12000/ 25

y= Rs 480

Rs 480 is the equilibrium level of income.