ISI 2011 ME2 Q10- National accounting

Posted by RichaS on Mar 08, 2017; 3:28am
URL: http://discussion-forum.276.s1.nabble.com/ISI-2011-ME2-Q10-National-accounting-tp7603313.html



Period 1: Y=C+I+Loan taken
             200=50+50+100

Period 2: C=0.5*200= 100
              Autonomous investment= 50
              Y should be 100+50=150
              But repayment of loan: So Y =150-100=50
              Therefore: 50= 100+50 -(100)
              Therefor savings= (-100)
               No equilibrium

Please help with this