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Consider a Simple Macro Model with Government and Foreign Trade

Question 41

Multiple Choice

Consider a simple macro model with government and foreign trade and where the price level is taken as given.The simple multiplier is equal to

A) 1/(1 - MPC) .
B) 1/MPC.
C) 1/(1- MPS - t) .
D) 1/(1 - (MPC(1 - t) - m ) ) .
E) 1/(1- (MPS(1 - t) - m ) ) .

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