Equality b/w saving n investment is not determined by rate f interest but by changes in National Income.discus

Question

Equality b/w saving n investment is not determined by rate f interest but by changes in National Income.discus

Answer 1

S - I = NX (e) = CF(r)

Actually saving shouldn't be necessarily equal. National income minus national consumption equals national saving.

In general model consumption is relatively constant than saning (income). If national income falls due to business cycle, consumption usually reacts slower, thus to keep consumption nation usually scarifies investments. Though it is just quick reply, I might be messing some points.