NAME:

ID NO:
TUTORIAL 8c
CLASS:
CHAPTER 8: NATIONAL INCOME EQUILIBRIUM

QUESTION 1
Based on the following information, answer the question below. (All figures are in RM
million)
Consumption (C) = 100 + 0.75Yd

Investment (I) = 50

Government (G) = 75

Taxes (T) = 0

(a) Calculate equilibrium level of national income.

Yd= y-Tax (0)

Yd= y-0
Yd= y

Y= C + I + G

Y = 100+ 0.75Y + 75

0.25 Y = 175

Y = RM700 million

(b) Calculate the level of consumption at equilibrium level of national income.

C = 1oo + 0.75 ( 700 ) + 75

C = RM 700 million

(c) If government imposes a tax at RM30 million,

i. Calculate the new equilibrium level of national income.

ii. Calculate the level of disposable income.
QUESTION
Based on the following information, answer the questions below. (All figures are in RM
million)
Consumption (C) = 250 + 0.8Yd

Investment (I) = 100

Government (G) = 80

Taxes (T) = 0.1Y

(a) Calculate the equilibrium level of national income (Y).

(b) Calculate the level of disposable income (Yd).

(c) Calculate the level of consumption at equilibrium level of national income (C).
QUESTION
Assume that there is a three-sector economy, where
C = 50 + 0.75Y
I = 90
G = 60
T =0

(All data/value in RM million)

National Aggregate
Consumption Saving Government Investment
Income Demand
(C) (S) (G) (I)
(Y) (AD)
0
200
400
600
800
1000

(a) Complete the above table.

(b) What happen to APC and APS when income equals to RM200 million?

(c) Determine the equilibrium level of national income.

QUESTION
Given, C = 15 + 0.8Yd
G = 20
I = 10
T =5
X = 45
M = 20

(All figures are in RM million)

Calculate:
a. The equilibrium level of national income (Y)

b. The level of disposable income (Yd)

c. The consumption level (C)

QUESTION

1. Assume that there is a four-sector economy. (All data/ value in RM million). Given
that:
C = 20 + 0.8Yd
G = 60
I = 10
T = 0.1Y
X = 200
M = 150

a. Calculate the equilibrium level of national income (Y).

b. Calculate the level of disposable income (Yd) at equilibrium level of national

income.

c. Calculate the level of consumption (C) at equilibrium level of national income.

d. Calculate the level of tax (T) imposed by the government at equilibrium level
of national income.