The Figure Given Below Represents the Macroeconomic Equilibrium in the Aggregate

question 117

Multiple Choice

The figure given below represents the macroeconomic equilibrium in the aggregate income and aggregate expenditure framework. Assume that MPI is equal to zero.
Figure 10.4
In the figure:
C: Consumption
I₁ and I₂: Investment
G: Government Spending
X: Exports
-In Figure 10.4, calculate the marginal propensity to consume.

• A) 0.67
• B) 0.50
• C) 0.25
• D) 0.33
• E) 4

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Definitions:

Communications

The act or process of exchanging information and ideas through various mediums and platforms.

Transaction Costs

Expenses incurred when buying or selling goods and services, encompassing fees, taxes, and other costs.

Middlemen

People who buy and sell goods or services or arrange trades. A middleman reduces transaction costs.

Transaction Costs

Expenses incurred when buying or selling goods and services, which can include fees, taxes, and other charges.