CALCULATE

1 . AGGREGATE EXPENDITURE FUNCTION

2. THE AUTONOMOUS EXPENDITURE

QUESTION 1 . Timbuktree is a country which has moved in recent times into manufacturing of heavy machinery and is the largest producer and exporter of steel in the world. Its national income for 2013 is driven by the following: Autonomous consumption $40, investment $80, government expenditure $70, autonomous taxes $20, exports $100 and import $20. (All information is expressed in billions of dollars). The marginal propensity to consume is 0.6. The income tax rate is 0.20. The import rate is 0.1