# B given the information calculate the level of

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Chapter 6 / Exercise 2
Applied Calculus for the Managerial, Life, and Social Sciences
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(b) Given the information, calculate the level of consumption and saving that occurs at the equilibrium level of income. (c) Suppose planned investment increases by 100. Calculate the new equilibrium level of income. Given your answer, what is the size of the multiplier for this economy? (d) Will the level of saving and consumption change as the economy adjusts to this change in planned investment? Explain.
5. Assume that the saving function is S = - 100 + .1Y and planned investment is 40. Calculate the equilibrium level of output using the leakages/injections approach. How much would output contract by if planned investment fell by 10?
6. Assume the following saving function and investment function: S = -200 + .25Y and I = 25. Calculate the equilibrium output level.
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Chapter 6 / Exercise 2
Applied Calculus for the Managerial, Life, and Social Sciences
Tan
Expert Verified
7. Suppose an economy is initially in equilibrium at \$800 billion and investment increases by \$10 billion. This causes the economy to expand to \$1200 billion. Calculate the value of the multiplier.