Question

The consumption function is c=100+0.25y calculate savings if consumption expenditure at equilibrium level of national income is 500 crores

Answer 1

Answer:

Explanation:

C=500

Putting the value

500=100+0.25Y

500-100=0.25Y

400=0.25Y

Y= 1600 crores

We also know,

Y=C+S

1600=500+S

S=1100 crore