If the Marginal Propensity to Save Equals 0

question 65

True/False

If the marginal propensity to save equals 0.1 and the marginal propensity to import equals 0.3,an autonomous increase in exports of $1,000 would expand domestic income by $2,500 which leads to an increase in imports of $750.

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Definitions:

Reversionary Interest

A future interest in property that returns to the original owner or the owner's heirs after the expiration of a temporary estate.

Contingent Remainder

A future interest in real property that depends on the occurrence of an uncertain event before it becomes possessory.

Property Interest

A legal right or claim to resources or possessions, such as real estate or intellectual property.

Graze

The act of eating small quantities of food periodically or animals feeding on grass in a pasture.