Question : The saving function of an economy is given as S= -40+0.40Y. If the planned investment is Rs. 250 crore, Calculate equilibrium level of income in the economy.
Option 1: 725
Option 2: 755
Option 3: 780
Option 4: 800
Answer (1)
14th Jan, 2024
Correct Answer: 725
Solution : Equilibrium,
S=I
-40+0.40Y=250
0.40Y= 290
Y= 725 crore
Hence, Option A is correct.
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