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    Macroeconomics Study Set 9
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    Exam 10: Explaining Aggregate Demand: the Is-Mp Model
  5. Question
    If the MPC = 0
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If the MPC = 0

Question 42

Question 42

Multiple Choice

If the MPC = 0.75,a decrease in personal taxes from $100 billion to $80 billion will increase real GDP by


A) $20 billion.
B) $40 billion.
C) $60 billion.
D) $80 billion.

Correct Answer:

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