If the Marginal Propensity to Save Is 0

question 53

Multiple Choice

If the marginal propensity to save is 0.3 and the marginal propensity to import is 0.1, and the government increases expenditures by $10 billion, ignoring foreign-income repercussions, how much will GDP rise?

• A)$20 billion.
• B)$10 billion.
• C)$25 billion.
• D)$15 billion.

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