Refer the table below and answer the questions that follow. Aggregate Output ($ million) Y Aggregate Consumption ($ million) C Aggregate Saving ($ million) S Planned Investment ($ million) I Aggregate Expenditure AE = C+I 2,000 1,500 700 2,400 1,800 700 2,800 2,100 700 3,200 2,400 700 3,600 2,700 700 Fill in the table and find the equilibrium income. Find the MPC, MPS and the multiplier. If the planned investment increases by $100 million find the new equilibrium level of income.
Refer the table below and answer the questions that follow. Aggregate Output ($ million) Y Aggregate Consumption ($ million) C Aggregate Saving ($ million) S Planned Investment ($ million) I Aggregate Expenditure AE = C+I 2,000 1,500 700 2,400 1,800 700 2,800 2,100 700 3,200 2,400 700 3,600 2,700 700 Fill in the table and find the equilibrium income. Find the MPC, MPS and the multiplier. If the planned investment increases by $100 million find the new equilibrium level of income.
Chapter18: The Keynesian Model
Section: Chapter Questions
Problem 6SQ
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Question
- Refer the table below and answer the questions that follow.
($ million) Y |
Aggregate Consumption ($ million) C |
Aggregate Saving ($ million) S |
Planned Investment ($ million) I |
Aggregate Expenditure AE = C+I |
2,000 |
1,500 |
|
700 |
|
2,400 |
1,800 |
|
700 |
|
2,800 |
2,100 |
|
700 |
|
3,200 |
2,400 |
|
700 |
|
3,600 |
2,700 |
|
700 |
|
- Fill in the table and find the equilibrium income.
- Find the MPC, MPS and the multiplier.
- If the planned investment increases by $100 million find the new equilibrium level of income.
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