Text for background information The effect of changes in C,I,G,T,X,M and consumer confidence on the equilibrium output Let the calculations be based on an initial income (Y) of 1000. Let Consumption (C) be a function of both disposable income (Y-T), (and the corresponding multiplier) Let Investment(I) be between 50 and 500 as Gross Fixed Investment as a percentage of GDP varies from 5 to 45% http://en.wikipedia.org/wiki/List_of_countries_by_gross_fixed_investment_as_percentage_of_GDP Let Govt. spending (G) be between 0 to 450 Let Taxation (T) be between 10 to 60% of Y Let Exports and Imports vary between 0 to 100 Let the rate of interest (r) vary between 1 to 15% Let the Marginal Propensity to Consume (MPC) vary from 0.5 to 0.9 (there is always some leakage from the circular flow) For consumption, let a= the welfare payments made (total) in the absence of expenditure, and let it vary from 100 to 200 Manipulate[ Consumption[a_,r_,t_,x_,MPC_]:=a*(1 - r) + (x - t*x)/MPC; Plot[{x,Cosumption[a,r,t,x,MPC]+I+G+X-M,I+G+X-M},{x,0,12000}, AxesLabel -> {Income - Y, Expenditure - E}, PlotRange -> Automatic, PlotStyle -> {Red, Green, Blue, Black}], {{t, 0.3, "Tax rate"}, 0, 0.6}, {{a, 150, "Welfare Payments in absence of expenditure"}, 100, 200}, {{MPC, 0.75, "Marginal Propensity to Consume"}, 0.5, 0.9}, {{r, 0.07, "Rate of Interest"}, 0.01, 0.15}, {{I, 300, "Investment"}, 50, 500}, {{G, 200, "Government Spending"}, 0, 450}, {{X, 20, "Exports"}, 0, 50}, {{M, 40, "Imports"}, 0, 50}]