Suppose the Price Level Is Constant, Output Is Demand- Determined

question 97

Multiple Choice

Suppose the price level is constant, output is demand- determined, and the economy is closed with no government. If the saving function is S = - 100 + (0.4) Y, the simple multiplier is

• A)0.2.
• B)1.
• C)2.5.
• D)5.
• E)- insufficient information to know.

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