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The Investment Function Intersects the Saving Schedule at an Interest

Question 60

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The investment function intersects the saving schedule at an interest rate of 8 percent and a level of investment of $1.5 trillion a year. If the consumption curve intersects the 45-degree reference line at $3 trillion, then


A) the C + I curve will intersect the 45-degree reference line at $1.5 trillion.
B) the C + I curve will intersect the 45-degree line at $1.8 trillion.
C) the equilibrium level of real GDP is $3 trillion.
D) the equilibrium level of real GDP is $4.5 trillion.

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