Calculate ex ante aggregate demand when
autonomous investment is ₹100 crore,
autonomous consumption is ₹100 crore,
MPS is 0.4 and
income level is ₹4,000 crore.
Answer & explanation
Correct answer: option 3
AD = C + I
AD = (c+bY) + I
AD = (100 + 0.6*4000) + 100
AD = 2400 + 100 + 100
AD = ₹2600