Assume a = 150, b = 0.75, I = 200, Yf = 1600. Find the value of consumption at the equilibrium...

Question:

Assume a = 150, b = 0.75, I = 200, Yf = 1600.

Find the value of consumption at the equilibrium level of output and income.

Consumption:

The term consumption refers to the fraction of individual income not used for saving and investment purposes. There are two of consumption - autonomous consumption and induced consumption.

Answer and Explanation: 1

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The correct answer is the value of consumption at the equilibrium level of output and income is 1,200.

The Consumption function can be written as:

C...

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What is Consumption in Economics? - Definition & Theory

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Chapter 45 / Lesson 2
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Learn about consumption in economics. Read examples of consumption in economics and find out 4 types of consumption in economics, what affects it, and how it is measured.


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