In: Economics
Income (Yd) |
Consumption Expenditure (C) |
Saving (S) |
Investment Expenditure (I) |
Government Expenditure (G) |
Net Export Expenditure (NX) |
Aggregate Expenditure (AE) |
$8000 |
$11,000 |
$2,500 |
$5,000 |
$12,500 |
||
12,000 |
14,000 |
2,500 |
5,000 |
12,500 |
||
20,000 |
20,000 |
2,500 |
5,000 |
12,500 |
||
30,000 |
27,500 |
2,500 |
5,000 |
12,500 |
||
50,000 |
42,500 |
2,500 |
5,000 |
12,500 |
||
100,000 |
80,000 |
2,500 |
5,000 |
12,500 |
1. Calculate: Savings, MPC, MPS, Multiplier, and the equilibrium level of income (Y = AE = C + I + G + NX).
2. Draw a graph showing disposable income (Yd) on the horizontal axis and aggregate expenditures (AE) on the vertical axis with a 45 degree line. Graph AE (AE = C + I + G + NX) curve on this graph. Indicate break even level of income (Y=C) and equilibrium level of income (AE=Yd).