Consider an economy in which autonomous consumption, planned autonomous investment, autonomous government expenditure, autonomous taxes, and the marginal propensity to consume are given (there are no net exports).   Autonomous consumer spending = $3,000          Ip = $5,000      G = $3,000      T = $4,000                                                                               MPC = .75 What is the level of actual investment [Actual investment includes both planned and unplanned inventory changes. Hint: Compare Y and C + I + G at the level of income in part (a)] if Y = $19,000? What is the level of unintended or unplanned inventory investment?

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Chapter9: Demand-side Equilibrium: Unemployment Or Inflation?
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. Consider an economy in which autonomous consumption, planned autonomous investment, autonomous government expenditure, autonomous taxes, and the marginal propensity to consume are given (there are no net exports).

 

Autonomous consumer spending = $3,000          Ip = $5,000      G = $3,000      T = $4,000

                                                                              MPC = .75

What is the level of actual investment [Actual investment includes both planned and unplanned inventory changes. Hint: Compare Y and C + I + G at the level of income in part (a)] if Y = $19,000? What is the level of unintended or unplanned inventory investment?

 

 

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