Given a simple Keynesian model of national income (Y=C+I) Where: Y=Kshs. 7,500 C= 1000 +0.8Y I= 500
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Given a simple Keynesian model of national income (Y=C+I) Where: Y=Kshs. 7,500 C= 1000 +0.8Y I= 500 AI= 100
(i) Calculate equilibrium income and consumption befor the change in investment
(ii) Calculate equilibrium income change in Investment
(iii) Derive the savings function
(iv) Calculate and interpret the investment multiplier and consumption after the
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