Suppose Equilibrium Real GDP Demanded Rises from $4 Trillion to $6

question 137

Multiple Choice

Suppose equilibrium real GDP demanded rises from $4 trillion to $6 trillion when government purchases increase by $1 trillion.What is the marginal propensity to consume?  

• A) 0.8 
• B) 0.5 
• C) 0.4 
• D) 0.2

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