Question

What is the equilibrium level of income in this Keynesian model?

        When DI (AP) = 1000, C=1200, Ip=300, G=200, Exports=100, Imports=50
        When DI (AP) = 2000, C=2000, Ip=300, G=200, Exports=100, Imports=100
        When DI (AP) = 3000, C=2800, Ip=300, G=200, Exports=100, Imports=150
        When DI (AP) = 4000, C=3600, Ip=300, G=200, Exports=100, Imports=200
        When DI (AP) = 5000, C=4000, Ip=300, G=200, Exports=100, Imports=250

Answer 1

DI	C	Ip	G	Export (X)	Import (IM)	Aggregate Expenditure (AE)
1000	1200	300	200	100	50	1750
2000	2000	300	200	100	100	2500
3000	2800	300	200	100	150	3250
4000	3600	300	200	100	200	4000
5000	4000	300	200	100	250	4350

Aggregate Expenditure (AE) = C + Ip + G + X - IM

At equilibrium, DI = AE.

DI = AE = 4000.

Hence, the equilibrium level of income is 4000.

Answer: 4000.