Consider a Simple Macro Model with a Constant Price Level

question 79

Multiple Choice

Consider a simple macro model with a constant price level and demand-determined output.The equations of the model are: C = 150 + 0.84Y,I = 400,G = 700,T = 0,X = 130,IM = 0.08Y.The marginal propensity to spend on national income,z,is

• A)0.655.
• B)0.760.
• C)0.773.
• D)0.840.
• E)0.920.

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Definitions:

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