1.consider the simplified national income model:

AD=C+l.......(1)

when AD is aggregate demand c is consumption, and I is investment. Consumption is determined by a behavioral equation, which is this problem takes the form

C=3,300+.8Y......(2)

Y is national income.

Y and C are endogenous variable and investment is exogenous variable. Initially we assume

l=1,500........(3)

The equilibrium condition requires that aggregate demand equals national income,that is,

AD=Y...............(4)

be Maps 3 Launch Meeting - Z... G Google 2. Consider the simplified national income model: AD = C + /............(1) Where AD is aggregate demand, C is consumption, and I is investment. Consumption is determined by a behavioral equation, which in this problem takes the form C= 3,300 + 8 Y........(2) Y is national income. Y and C are ENDOGENOUS VARIABLE and investment is exogenous VARIABLE. initially we assume 1-1,500.. (3) The equilibrium condition requires that aggregate demand equals national income, that is, AD = Y.................. ..(4)