Posted by Sarah on .
Suppose that S(savings) = $4 billion when Real GDP = $200 billion & S(savings) = $104 billion when Real GDP = $600 billion. If Autonomous investment falls by $100 billion what would be the effect on Real GDPeqm.?
Note: eqm. = equilibrium
My answer is a fall of $400 Billion on the Real GDPeqm.
I agree w $400B