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As Used in the Income-Expenditure Diagram in Macroeconomics, the 45

Question 60

Multiple Choice

As used in the income-expenditure diagram in macroeconomics, the 45 degree line:


A) shows all the points at which spending and real income are equal.
B) contains only a consumption component.
C) represents consumption plus planned investment.
D) shows those income levels where the marginal propensity to save is 1.

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