Isi 2005 me 2

[urvashi]

How do we attempt q4?

[Dr. Strange]

Y=C+I=C+0.3Y+IO
C=Y(1-s)-SO                                   SO AND IO are autonomous saving and investment  AND S is savings

SOLVING,Y=IO-SO/(s-0.3)
del Y= -del SO/(s-0.3).......1

Also S=SO+sY
del S=del SO +s del Y
12=del SO +s del Y....2(GIVEN)

Solving 1 and 2,del Y=40

[urvashi]

Thank you