Q: In order to reach the full-employment level of income, government spending must increase by which amount.
Good day, some help (with steps) on the following will be much appreciated!
Given that autonomous spending = R50, Investment = R230, Government spending = R300, marginal propensity to consume = 0.75, Tax = R100 and full employment level of income = R3000, what is the equilibrium level of output and income? In order to reach the full-employment level of income, government spending must increase by which amount.