Q. Please see attached question with hint.
S = -$500 + .2Y
Ip = 300
G = T = Xn = 0
a) Illustrate what is consumption function for this economy?
b) Illustrate what is equilibrium level of GDP?
c) Explain how much is saved at equilibrium?
d) If savings fell by $200 at every level of GDP, illustrate what would be equilibrium level of income?