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Suppose Aggregate Output Is Demand Determined

question 68

Multiple Choice

Suppose aggregate output is demand determined.If the marginal propensity to spend is 0.5,and the MPC is 0.7,a $1 billion reduction in government purchases will cause equilibrium national income to ________ by ________.


Definitions:

Communication Benefits

The advantages gained from effectively sharing and exchanging information between parties, enhancing understanding and efficiency.

Self-Realization Benefits

Advantages gained from products or services that help individuals achieve their full potential or personal goals.

Perceptual Benefits

The advantages or positive outcomes perceived by consumers, often subjective and based on personal interpretation of a product or service’s attributes.

Functional Benefit

The practical or utilitarian advantage that a product or service provides to its users.

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