Answer to Question #169157 in Macroeconomics for Alvina

Question

 If the consumption function is given as C= 20 + 0.8Yd, complete the 

 Following table: 

 

Disposable 

Income (Yd) 

200 500 

Consumption 

(C) 

 300 700 

Savings (S) 100

Answer 1

$$solution$$

The $C=20+0.8Yd$

$given\ disposable \ income(Yd) :\\ at \ 200\\ C=20+(0.8\times 200)=180\\ at\ 500\\ C=20+(0.8\times500)=420\\$

$Given\ Consumption (C):\\ at \ 300\\ 300=20+0.8Yd=350\\ 700=20+0.8Yd=850\\$

$Savings(S)\\ S=Y-C\\ 100=Y-20+0.8Yd\\ 120=Y+0.8Yd\\ 120=1.8Yd\\ Y=[\frac{120}{1.8}]\\ Y=66.66$