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If the Marginal Propensity to Save Is 0

Question 186

Multiple Choice

If the marginal propensity to save is 0.1, then a $10 million decrease in disposable income will


A) increase consumption by $9 million.
B) increase consumption by $1 million.
C) decrease consumption by $9 million.
D) decrease consumption by $1 million.
E) leave consumption unchanged.

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