Answer to Question #50382 in Macroeconomics for abdulla sabit
Suppose household consumption is C=100+0.90Y, whereY=income, and investment is 150. Find the equilibrium output and consumption.
We can write an equation
Y = Equilibrium output = C + I
Y = 100+0.90Y + 150
0.1Y = 250
Y = 2500
Now we can find consumption
C= Consumption = 100+0.90Y
C = 2350
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