C=100+0.4Y is the consumption function of an economy where C is Consumption Expenditure and Y is National Income. Investment expenditure is 1,100 Calculate(i) Equilibrium level of National Income, (ii) Consumption expenditure at equilibrium level of national income.

C=100+0.4Y is the consumption function of an economy where C is Consum

1.	C=100+0.4Y is the consumption function of an economy where C is Consumption Expenditure and Y is National Income. Investment expenditure is 1,100 Calculate(i) Equilibrium level of National Income, (ii) Consumption expenditure at equilibrium level of national income.
Answer» (i) we know `Y=C+I` `=100+0.4Y+1100` `Y-0.4Y = 1,200 OR ` ` 0.6Y = 1,200 x10//6` ` = 2,000` (ii) equilibrium level of income = 2,00 investment = 1,100 therefore = 1,100 therefore , consumption expenditure `=2,000-1,100` `=900`