Need help MC question! plz (1 Viewer)

[StevChe]

hey guys i cant get this mc question mind blank can someone help plz

what is equilibirum level of income if C=100+0.8y and I = 40

a)100
b)140
c)500
d)700

answers 700 but i dont no how it works out to be like can someone plz explain it thanx..

 

[khoshgelleh]

what is equilibirum level of income if C=100+0.8y and I = 40

a)100
b)140
c)500
d)700

it is a simple maths equation

C+I = Y
(100+ 0.8Y) + I =Y
( 100+0.8Y) + 40 = Y
140+0.8Y = Y
140 = Y- 0.8Y
140 = 0.2Y
THERFORE Y= 140 / 0.2
= 700

i hope that helps

 

[StevChe]

thanx heaps..i no my maths just couldnt get the formula

 

[Rekkusu]

Though, just a little advice I've personally checked this type of question with leading edge and hsc advice line, these aren't asked except in your hsc trials.

As for all these eco growth, Y formulas, just know your multiplier effect, as well as Y =c + i + g + (x-m)

 

[StevChe]

ahh k well i got that of multiple choice online on bos..so..yeh..

 

[Rekkusu]

Ouch =p then yeah be on the safe side ^^