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Suppose Consumption Is $7,500 When Income Is $4,000 and the MPS

Question 205

Multiple Choice

Suppose consumption is $7,500 when income is $4,000 and the MPS equals 0.4. When income increases to $6,000, consumption is

A) $8,050.
B) $8,300.
C) $8,700.
D) $9,500.

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