Multiple Choice
Consider a consumption function in a simple macro model with government and taxes.Given a marginal propensity to consume out of disposable income of 0.8 and a net tax rate of 20% of national income,the marginal propensity to consume out of national income is
A) 0.36.
B) 0.64.
C) 0.80.
D) 0.90.
E) 1.00.
Correct Answer:
Verified
Correct Answer:
Verified
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