Explain the following:
Ex-ante (Planned) saving and Ex-ante (planned) investment.
or
If planned savings is greater than planned investment, what adjustment will bring about equality between the two?
or
What changes will take place to bring an economy in equilibrium if (i) planned savings are greater than planned investment, (ii) planned savings are less than planned investment? 

In the context of saving-investment approach to determine equilibrium level of income in the economy, it is important to understand the difference between the words Ex-ante and Ex-post because equilibrium occurs only when ex-ante savings and ex-ante investment are equal.
Briefly ex-ante expression indicates before the event and ex-post expression indicates after the event. For instance, what the households plan to cosume during the year in the beginning of the period is called ex-ante consumption but the amount of actual consumption measured at the end of the year is called ex-post consumption. Similarly, the amount of investment which the firms plan (or intend) to make during a period is ex-ante investment but what the firms have actually invested measured at the end of the period is ex-post investment. At any level of income, ex-post savings are always equal to ex-post investment. The significance of distinction between ex-ante and ex-post is that in the theory of determination of income, all variables are ex-ante (planned) variables.

Planned saving and Planned investment.
The savings which are planned (intended) to be made by all the households in the economy faring a period (say, a year) in the beginning of a period is called planned (or Wflnte) savings, The amount of planned or desired savings is given by the saving function ((.e., propensity to save).
The investment which is planned to be made by the firms or entrepreneurs in the economy during a period (say, a year) in the beginning of a period is called planned (or ex–ante) investment. The amount of planned investment is given by the investment demand function.
The following points in this context need to be noted.
(i) Equilibrium in the economy occurs only when planned investment is equal to planned savings. Ex-ante savings and investment may or may not be equal. It is only when ex-ante savings = ex–ante Investment that equilibrium takes place. It means that an economy invests what it has saved. Such equilibrium is rare because savers and investors are different people who save and invest with different motives. [Mind, expost (actual) savings and expost (actual) investment are always equal at all levels of income.]

(ii) When planned saving is not equal to planned investment, i.e., when planned spending is not equal to planned output, then output will tend to adjust up or down until the two are equal again.

Adjustment Mechanism (when planned saving is not equal to planned investment).

(i) When planned (ex-ante) saving is more than planned investment. Suppose firms plan to invest र 20,000 crores but households plan to save र 25,000 crores, it shows consumption expenditure has decreased. Consequently, AD falls short of AS. Due to excess supply there will be stock piling of unsold goods, i.e., unintended unplanned inventories will accumulate. At this, the producers will cut down employment and produce less. National income will fall and as a result planned saving will start falling until it becomes equal to planned investment. It is at this point that equilibrium level of income is determined.

(ii) When planned (ex-ante) saving is less than planned investment. Suppose producers plan to invest र 20,000 crores but households plan to save र 15,000 crores, then AD (or consumption expenditure) is more than AS. Production will have to be increased to meet the excess demand. Consequently national income will increase leading to rise in saving until saving becomes equal to investment. It is here that equilibrium level of income is established because what the savers intend to save becomes equal to what the investors intend to invest. Sum and substances is that if planned saving and planned investment are equal, then output, income, employment and price level will be constant.