Suppose Aggregate Output Is Demand- Determined

question 31

Multiple Choice

Suppose aggregate output is demand- determined. Suppose a decrease in autonomous investment expenditure of $20 million reduces equilibrium national income by $50 million. The simple multiplier is equal to

• A)0.6.
• B)0.4.
• C)- 0.6.
• D)- 2.5.
• E)2.5.

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