In the Keynesian Model, the Larger the Marginal Propensity to Consume

question 68

Multiple Choice

In the Keynesian model, the larger the marginal propensity to consume, the:

• A) larger the multiplier.
• B) larger the marginal propensity to save.
• C) higher the income level of the economy.
• D) smaller the change in income derived from a given change in government spending.

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Definitions:

Employer-Paid Retirement Program

A retirement benefit plan funded by an employer that provides income to employees after their retirement.