According to the Keynesian-Cross Analysis, When There Is a Shift

Multiple Choice

According to the Keynesian-cross analysis, when there is a shift upward in the government-purchases schedule by an amount ∆G and the planned expenditure schedule by an equal amount, then equilibrium income rises by:

A) one unit.
B) ∆G.
C) ∆G divided by the quantity one minus the marginal propensity to consume.
D) ∆G multiplied by the quantity one plus the marginal propensity to consume.