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Which of the Following Equations Illustrates the Equilibrium Level of Income

Question 57

Multiple Choice

Which of the following equations illustrates the equilibrium level of income with respect to the simple Keynesian closed-economy model?


A) Y = [1/(1 − b) ](a − bT − I + G)
B) Y = [1/(1 − b) ](a + bT + I + G)
C) Y = [1/(1 + b) ](a − bT − I − G)
D) Y = [1/(1 − b) ](a − bT + I + G)
E) Y = (1 − b) (a + bT + I + G)

Correct Answer:

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