3) Suppose that for a particular economy, investments (I) equal $100m, government expenditures (G) are $250m, exports (X) amount to 400m while imports (M) are $175m. The consumption function can be represented by the following equation: C = 300M + 0.80Yd

a) Identify the following:

(i) Autonomous consumption 1 mark
(ii) The marginal propensity to consume 1 mark
(iii) The value of the multiplier 2 marks

b) Calculate the equilibrium level of GDP(Y) 5 marks

c) Draw a Keynesian cross showing the equilibrium level of GDP (calculated in question 3b) and aggregate expenditure. 5 marks

being born in poverty would limit the people's chances, opportunities and benefits.

this happen because of several things, such as:

- poor people tend to gain less access to good education and nutrition. this mean that their chance to obtain high paying jobs would also be limited.

- poor people tend to socialize with other poor people while the rich tend to socialize with other rich people. this means that simply throguh their social circle, rich people would have more business opportunities compared to the poor people.

- rich people tend to have more capital in their disposal. this would benefit them in business since it is far easier for them to fund their business operation compared to poor people.

answerservice script;

the answers are

a, b, c, & e.