(a)‌Elaborate‌ ‌‌THREE‌ ‌(3)‌ ‌determinants‌ ‌in‌ ‌which‌ ‌consumption‌ ‌can‌ ‌be‌ ‌increased‌ ‌according‌ ‌to‌ ‌the‌ ‌consumption‌ ‌function.‌

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
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Chapter1: Making Economics Decisions
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(a)‌Elaborate‌ ‌‌THREE‌ ‌(3)‌ ‌determinants‌ ‌in‌ ‌which‌ ‌consumption‌ ‌can‌ ‌be‌ ‌increased‌ ‌according‌ ‌to‌ ‌the‌ ‌consumption‌ ‌function.‌ ‌
 ‌
(b)‌Assume‌ ‌that‌ ‌a‌ ‌three-sector‌ ‌economy‌ ‌in‌ ‌Country‌ ‌W.‌ ‌The‌ ‌amount‌ ‌of‌ ‌
autonomous‌ ‌consumption‌ ‌is‌ ‌RM300‌ ‌million‌ ‌with‌ ‌the‌ ‌proportion‌ ‌of‌ ‌an‌ ‌increase‌ ‌in‌ ‌income‌ ‌that‌ ‌is‌ ‌spent‌ ‌on‌ ‌consumption‌ ‌is‌ ‌0.5.‌ ‌An‌ ‌induced‌ ‌tax‌ ‌of‌ ‌20%‌ ‌is‌ ‌imposed‌ ‌by‌ ‌the‌ ‌country.‌ ‌The‌ ‌amount‌ ‌of‌ ‌investment‌ ‌is‌ ‌RM250‌ ‌million,‌ ‌and‌ ‌the‌ ‌amount‌ ‌of‌ ‌government‌ ‌spending‌ ‌is‌ ‌RM150‌ ‌million.‌ ‌
 
 ‌
(i)‌Calculate‌ ‌the‌ ‌national‌ ‌income‌ ‌equilibrium.‌ ‌
 
 ‌ ‌
(ii)‌Based‌ ‌on‌ ‌your‌ ‌answer‌ ‌in‌ ‌(i),‌ ‌show‌ ‌the‌ ‌aggregate‌ ‌expenditure‌ ‌graph.‌ ‌ ‌
 
 ‌
(iii)‌Explain‌ ‌what‌ ‌would‌ ‌happen‌ ‌to‌ ‌the‌ ‌national‌ ‌income‌ ‌equilibrium‌ ‌if‌ ‌the‌ ‌
investment‌ ‌changes‌ ‌by‌ ‌RM100‌ ‌million.‌
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