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Assume That the Economy, as Represented by the Simple Keynesian

Question 218

Multiple Choice

Assume that the economy, as represented by the simple Keynesian model, is in equilibrium with income equal to $6 million and consumption spending equal to $5 million. Which of the following is correct?


A) Investment is $1 million.
B) There is no saving in this economy.
C) The economy will go into disequilibrium because consumption is not equal to income.
D) The information provided is insufficient to determine the level of investment spending.

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