Question
Economics Question on Macroeconomics
The consumption function in an imaginary economy is known to be C = 100 + 0.75Y. The level of equilibrium income in this economy is 800 crores. What will be the value of investment in this economy?
A
200 crores
B
100 crores
C
400 crores
D
300 crores
Answer
100 crores
Explanation
Solution
Using the equilibrium condition, the investment is calculated as 100 crores.