<p>In equilibrium, </p>

<p>Y = AD                   ________________________             ( eq 1)</p>

<p>AD= C + I + G + NX </p>

<p>AD= 1,500 + cY + 1,000 + 2,000 - 200</p>

<p>Or AD = 4,300 +cY
Or Y = 4,300 +cY  ------(from 1)</p>

<p>Or (1-c)Y=4,300</p>

<p>Or 1-c = 4,300/Y = 4,300/21,500 = 0.2</p>

<p>Or 1-c = 0.2</p>

<p>Or <strong>c = 0.8</strong> </p>

<p>Hope this helps</p>

CC BY-SA 4.0
2018-06-12T08:39:02.533Z
2018-06-12T08:39:02.533Z
Karan Kumar
<p>Equations for <span class="math-container">$C$</span>, <span class="math-container">$I$</span>, <span class="math-container">$G$</span>, and <span class="math-container">$NX$</span> are given below. If the equilibrium level of <span class="math-container">$GDP$</span> is <span class="math-container">$\$21,500$</span>, what is the marginal propensity to consume?</p>

<p><span class="math-container">$$C = 1,500 + (MPC)\cdot Y$$</span>
<span class="math-container">$$I = 1,000$$</span>
<span class="math-container">$$G = 2,000$$</span>
<span class="math-container">$$NX = -200$$</span></p>

CC BY-SA 4.0
2018-06-11T07:59:56.833Z
Please provide your tentative solution so that we can get what is not clear to you
PostDocing
<gdp><equilibrium-selection>
Equation: If the equilibrium level of GDP is $21,500, what is the marginal propensity to consume?
Christina Campbell
# Equation: If the equilibrium level of GDP is $21,500, what is the marginal propensity to consume?

(Asked by: username_0 on 2018-06-11)

Equations for $C$, $I$, $G$, and $NX$ are given below. If the equilibrium level of $GDP$ is $\$21,500$, what is the marginal propensity to consume?

$$C = 1,500 + (MPC)\cdot Y$$
$$I = 1,000$$
$$G = 2,000$$
$$NX = -200$$

**Tags:** gdp, equilibrium-selection

> **Comments:**
> **username_1**: Please provide your tentative solution so that we can get what is not clear to you  

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## 1 answers

### Answer by username_2 on 2018-06-12. Score: 0

In equilibrium,

Y = AD \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ ( eq 1)

AD= C + I + G + NX

AD= 1,500 + cY + 1,000 + 2,000 - 200

Or AD = 4,300 +cY
Or Y = 4,300 +cY ------(from 1)

Or (1-c)Y=4,300

Or 1-c = 4,300/Y = 4,300/21,500 = 0.2

Or 1-c = 0.2

Or **c = 0.8**

Hope this helps


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