An isolated country is closed to foreign trade and investment.
Its government collects no taxes and spends no money. Initial
(autonomous) consumption to 300 million dollars. The marginal
propensity to consume equals 0.8. Finally, private investments
equal 100 million dollars
Find the aggregate consumption function.
Find the aggregate demand schedule.
Calculate equilibrium national income (Y).
If investment is to increase to 100 million dollars,
calculate the multiplier and the ultimate change in Y brought about
by the increase in investment.