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(Advanced Analysis) in a Private Closed Economy, (A) the Marginal

Question 85

Multiple Choice

(Advanced analysis) In a private closed economy, (a) the marginal propensity to save is 0.25, (b) consumption equals income at $120 billion, and (c) the level of investment is $40 billion. What is the
Equilibrium level of income?


A) $280 billion
B) $320 billion
C) $262 billion
D) $198 billion

Correct Answer:

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