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If the Marginal Propensity to Consume (MPC) Is 0

Question 53

Multiple Choice

If the marginal propensity to consume (MPC) is 0.75, and if the goal is to increase real GDP by $400 million, then by how much would government spending have to change to generate this increase in real GDP?


A) $140 million.
B) $100 million.
C) $200 million.
D) $400 million.

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