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guajiro [1.7K]
3 years ago
5

In the Keynesian-cross analysis, if the consumption function is given by C = 20 + 0.7 (Y – T), and planned investment is 100, G

is 100, and T is 100, then equilibrium Y is:
Business
1 answer:
Lyrx [107]3 years ago
7 0

Answer: 500

Explanation:

At equilibrium, it should be noted that,

Y = C + I + G

where ,

C = Consumption = 20 + 0.7(Y - T)

I = Investment = 100

G = Government expenditure = 100

Y = C + I + G

Y = 20 + 0.7(Y - 100) + 100 + 100

Y = 20 + 0.7Y - 70 + 200

Y - 0.7Y = 150

0.3Y = 150

Y = 150/0.3

Y = 500

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c. increases

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Will Jones, Pharoah is a small CPA firm that focuses primarily on preparing tax returns for small businesses. The company pays a
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