Question: Suppose that the Consumption Function in an economy is given by: C = 8 0 + 0 . 6 Y Also assume that: I =
Suppose that the Consumption Function in an economy is given by: CY Also assume that: I G NX If the Marginal Propensity to Consume MPC is equal to then what must be the tax rate in this example? What must be the Savings Function as a function of National Income Y be What is the AEF as a function of National Income Y What is the equilibrium National Income Y What is equilibrium Desired Consumption C and Desired Savings S in this example?
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