a) Consumption (C ) = Autonomous Consumption (Ca) + MPC (c){Income(Y) Autonomous Tax} = $1,400 + 0.6*($10,000 - $1,750) = $6,350 b) Savings (S) = Investment (1) = Y (national income) Consumption (C) Government Expenditure (G) = $10,000 - $6,350 - $1,950 = $1,700 c) Planned investment (Ip) = Y C G = S = $1,700. Actual investment = Y C G = $1,700 Unintended inventory investment = Actual Investment (I) planned Investment (Ip) = 1,700 1,800 = -$100 d) Injections: Savings + Tax + Imports Leakages: Investment +Government Expenditure + Exports Total injections = $1,800 + $1,750 + 0 = $3,550 Total leakages = $1,700 + $1,950 + 0 = $3,650 e) The economy is not at equilibrium when Y = $10,000. Equilibrium level = C + I + G = $6,350 + $1,800 + $1,950 = $10,100