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If the MPC Is 2/3 Then the Multiplier Is

Question 379

Multiple Choice

If the MPC is 2/3 then the multiplier is


A) 3/2, so a $100 increase in government spending increases aggregate demand by $150.
B) 3/2, so a $100 increase in government spending increases aggregate supply by $150.
C) 3, so a $100 increase in government spending increases aggregate demand by $300.
D) 3, so a $100 increase in government spending increases aggregate supply by $300.

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