This exercise will test students understanding of the aggregate expenditures functions, a number of the equations in the chapter, and several relevant concepts. It may be necessary to review the definitions of MPC and MPI before assigning the exercise.

Divide the class into groups of three or four and give them the following information:

Assume that I and G are autonomous.
Each group must fill in the missing values in the table. After ten minutes, groups are called on to give the values for different parts of the table.

Solution: