1.Assume that the consumption function is given by the following:

1.Assume that the consumption function is given by the following:

C=200+.9Y

Solve for the equilibrium level of income (Y*).

2.Assume that the consumption function is given by the following:

C=200+.9Y

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3.Assume that the consumption function is given by the following:

C=200+.9Y

What is the level of saving in equilibrium? 

4.Assume that the two sector AE model is given by the following:

AE = C+I

C=200+.9Y

I=100

Solve for the equilibrium level of income (Y*).

5.Assume that the two sector AE model is given by the following:

AE = C+I

C=200+.9Y

I=100

What is the level of saving in equilibrium? 

6.Assume that the two sector AE model is given by the following:

AE = C+I

C=200+.9Y

I=100

What is the level of saving if Y=3300