Can we just do S=I to find equilibrium income as we know it as an alternative form of equilibrium income by effective demand principle? BTW I love the video🙂👍💯
Hello. If tax= 20+ 0.2Y and it increases by 5% then the equation becomes 20+0.2Y + 5/100* (20+0.2Y) or something else? By this way, i couldn't get the correct ans as in the books. Please reply
Can we just do S=I to find equilibrium income as we know it as an alternative form of equilibrium income by effective demand principle?
BTW I love the video🙂👍💯
Nice
Good one
my pleasure
Hello. If tax= 20+ 0.2Y and it increases by 5% then the equation becomes 20+0.2Y + 5/100* (20+0.2Y) or something else? By this way, i couldn't get the correct ans as in the books. Please reply
0.2 means 20% tax rate. So 5% increase means Total 25%. So Tax = 20 + 0.25Y.
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ThankU!