income and expenditure model

Question

Apr 22, 2008, 06:20 AM

Vivi1987

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Join Date: Mar 2008

Location: Walvis Bay, Namibia

Posts: 11

income and expenditure model

*At what point is the consumption and national income equal?

I can't decide between Y1 and Y3. I know its is where the 45 degrees line intesects with the other.

*At what level of income is the economy in equilibrium?

Again its the point where it intersects with the 45 degrees line. Thats why I have difficulty with deciding between Y1 and Y3.

*What is the value of investment?

I known the I stands for Investment. So i was thinking of using algebra in this question.
As in E2= C + I
E1= C
So the answer which i came up with was (E2-E1)

Is this correct?

Please help me!

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