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Find National Income from the Following: Autonomous Consumption = Rs100 Marginal Propensity to Consume = 0.80 Investment = Rs 50 - Economics

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Find national income from the following:

Autonomous consumption = Rs100
Marginal propensity to consume = 0.80
Investment = Rs 50

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Solution

C = Rs 100

MPC (b) =0.80

I= Rs 50

At equilibrium,

Y=C+I

or `Y=barC+bY+I`

By substituting the values, we get

Y=100 + 0.8Y + 50
0.2 Y = 150

Y= Rs 750
National Income =Rs 750

Concept: Concept of National Income
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