I have a question from my textbook which is:
Using the Keynesian-cross analysis, assume that the consumption function is given by C = 100 + 0.6(Y – T). If planned investment is 100 and T is 100, then the level of G needed to make equilibrium Y equal 1,000 is:
and the answer is 260.
I don't understand how they derived this. Could someone please explain?