Multiple Choice
Given an MPC of 0.80, if there are no income taxes or imports and prices are constant, then when investment increases by $50 million and prices are fixed, equilibrium GDP would
A) increase by $50 million.
B) increase by $250 million.
C) increase by $400 million.
D) To answer the question more information on income is needed.
Correct Answer:
Verified
Correct Answer:
Verified
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