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Using the Keynesian Cross, If Autonomous Consumption Is $100, Government

Question 50

Multiple Choice

Using the Keynesian cross, if autonomous consumption is $100, government spending and taxes are $200, investment is $100, net exports are zero, and the marginal propensity to consume is 0.8, find equilibrium output.


A) $720
B) $1,000
C) $1,200
D) none of the above

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