Consider a Simple Macro Model with Demand-Determined Output

question 139

Multiple Choice

Consider a simple macro model with demand-determined output.Using such a model,if economists want to estimate the effect of a given change in desired investment on equilibrium national income,they would multiply the change in desired investment by the reciprocal of one minus

• A)the average propensity to save.
• B)the marginal propensity to save.
• C)the equilibrium level of national income.
• D)the marginal propensity not to spend.
• E)the marginal propensity to spend.