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If 20 Percent of Additional Income Is Not Spent and Business

Question 9

Multiple Choice

If 20 percent of additional income is not spent and business investment spending decreases by $10 billion at the same time that government purchases increase by $20 billion, total output and income will:


A) increase by $50 billion.
B) decrease by $50 billion.
C) increase by $150 billion.
D) decrease by $150 billion.

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