Find Consumption Expenditure following :National Income = Rs. 5,000Aut – InterviewSolution

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1.

Find Consumption Expenditure following :National Income = Rs. 5,000Autonomous Consumption = Rs. 1,000Marginal Propensitv to Consume = 0.8

Answer»

Y = C + I

and we know C = C bar + b(Y)

∴ Y = C bar + b(y) + I

or C = 1,000 + 0.8(5,000)

or C = 1,000 + 4,000

or C = Rs. 5,000

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