question_answer

Find investment from the following;
Items	Amount (Rs.)
National Income	Rs. 500
Autonomous Consumption	Rs. 100
Marginal propensity to Consume	0.75

Answer:

At equilibrium

\[Y=C+I\]

or,        \[Y=\overline{C}+bY+I\]where, b = MFC

\[500=100+(0.75\times ~500)+I\]

\[500-100-375=I\]

\[\therefore \]      Investment = Rs. 25