If the Marginal Propensity to Consume in Your Classmate's Nation

question 110

Multiple Choice

If the marginal propensity to consume in your classmate's nation is 3/5 and the marginal propensity to save in your country is 1/10,which of the following must be true?

• A)The spending multiplier is larger in your classmate's nation than in your country.
• B)The spending multiplier is smaller in your classmate's nation than in your country.
• C)Autonomous consumption is higher in your classmate's nation than in your country.
• D)Autonomous consumption is lower in your classmate's nation than in your country.
• E)Total consumption is lower in your classmate's nation than in your country.

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