Multiple Choice
Suppose there are three economies with 3 different consumption functions: Country A: C = 100 + 0.8Y Country B: C = 200 + 0.75 Y
Country C: C = 75 + 0.9Y
If the government spending increases by 10, in which of these countries would the shift of the AD curve be the largest?
A) Country B
B) Country C
C) Country A
D) All countries have the same shifts in the aggregate demand.
Correct Answer:
Verified
Correct Answer:
Verified
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