Multiple Choice
If investment spending decreases by $500 billion and if MPC = 0.6,
A) equilibrium GDP will rise by $1,250 billion
B) equilibrium GDP will fall by $500 billion
C) equilibrium GDP will fall by $1,250 billion
D) equilibrium GDP will rise by $500 billion
E) nothing will happen in the short run
Correct Answer:
Verified
Correct Answer:
Verified
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