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If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers. C = $ Y. S = $ Y. b. What is the economic meaning of b? . What is the economic meaning of (1 – b)? .

If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers. C = $ Y. S = $ Y. b. What is the economic meaning of b? . What is the economic meaning of (1 – b)? .

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter11: Simulation Models
Section: Chapter Questions
Problem 54P
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ADVANCED ANALYSIS  Linear equations for the consumption and saving schedules take the general form:

 

     C = a + bY

    

and 

 

     S = -a + (1-b)Y

 

where C, S, and Y are consumption, saving, and national income, respectively. The constant a represents the vertical intercept, and b represents the slope of the consumption schedule.

 

a. Use the following data to substitute specific numerical values into the consumption and saving equations.

 

 

 

 

Instructions: If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers.

 

    C = $             Y.

    S = $             Y.

 

b. What is the economic meaning of b? 

 

               .

 

     What is the economic meaning of (1 – b)? 

 

               .

 

 

 

 
 
 
 
 
 
 
 
 
 
 
 
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