help for question please (1 Viewer)

[lollipoplisa7]

hi...i was looking at some past multi choice questions and i didnt kno how to do this one....was wondering if someone could explain it to me please thank u...

What is the equilibrium level of income if C = 100 + 0.8Y and I = 40?

a-100
b-140
c-500
d-700

 

[maung]

u noe Y =C+I therefore

C=100+.8Y
C=100+.8(C+I)
C=100+.8(C+40)
C=660 sub into original to find Y
660=100+.8Y
.8Y=560
Y=700

hopes that answers your question.

 

[lollipoplisa7]

sigh......i feel so unprepared for these trials....so many little things i cant remeber..

thank u very much....

xoxo