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Question : On the basis of consumption function: C=120+0.6Y. Determine saving at the income level of Rs.800.

Option 1: 100

Option 2: 150

Option 3: 250

Option 4: 200


Team Careers360 6th Jan, 2024
Answer (1)
Team Careers360 16th Jan, 2024

Correct Answer: 200


Solution : C=\bar c +b(Y)

S=-\bar c +(1-b)Y

S=-120 +(1-0.6)800

S=200 \, crore

Hence, Option\, D\, is\, correct.

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