Question

the break even point for an economy occurs at the income level of is 500 crores is marginal propensity to consume is 0.6 determine autonomous consumption saving function level of income when saving is 600 crores​

Answer 1

Answer:

Y = 500

MPC=0.6

S=600

Autonomous con= x

S = -x +(1-MPC) Y

600 = -x +(1-0.6) 500

600 = -x +(0.4)500

600= -x +200

x = 200-600

x = -400

autonomous consumption= -400