Multiple Choice
Assume a two-country world (countries I and II) where taxes do not depend on income And where MPSI = 0.2, MPMI = 0.2, MPSII = 0.1, and MPMII = 0.3. In this situation, What is the numerical value of the autonomous spending multiplier that applies to a Change in autonomous investment in country I on country I's income, taking account of Foreign repercussions?
A) 1.0
B) 2.5
C) 4.0
D) 5.0
Correct Answer:
Verified
Correct Answer:
Verified
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