4. Suppose that the aggregate level of spending on consumer goods in an economy can be...

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4. Suppose that the aggregate level of spending on consumer goods in an economy can be represented by the following equation: b) Use this equation to illustrate the relationship between consumption and income. Be sure to label the graph carefully, not

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Answer 1

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Date C=500 +0.7(4-T) Nominal Imome 200 billion tax =20 % Aggregate consp=sou +0.7(0.8(200 bille) - sooto.ob/200 billion) =100

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