According to Keynesian, Equilibrium level of Income is achieved when ___________.

Planned Savings = Planned Investment

The correct answer is option (2) : Planned Savings = Planned Investment

Keynes argued that equilibrium in the economy occurs when total planned savings (S) equals total planned investment (I). This equality ensures that aggregate demand (which includes consumption, investment, government spending, and net exports) equals aggregate supply, leading to stable income and output levels in the economy. If planned savings exceed planned investment, inventories would accumulate, prompting producers to reduce output in subsequent periods. Conversely, if planned investment exceeds planned savings, inventories would decline, prompting producers to increase output to meet demand. Therefore, in equilibrium, planned savings must equal planned investment for the economy to be stable at that income level.