What will be the consumption (C) if b = 0.5 and income (y) is 500 and c̅ = 100?
Answer & explanation
Correct answer: option 2
The correct answer is Option 2: 350
C = c̅ + bY
C = 100 + 0.5 ( 500 )
C = 100 + 250
C = 350
What will be the consumption (C) if b = 0.5 and income (y) is 500 and c̅ = 100?
Correct answer: option 2
The correct answer is Option 2: 350
C = c̅ + bY
C = 100 + 0.5 ( 500 )
C = 100 + 250
C = 350