Question
What is the value of the government spending multiplier if marginal propensity to consume is 0.6?
Answer: Option D
:
D
The multiplier is given by 1(1−c).
So, when c = 0.6, the multiplier is 2.5.
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:
D
The multiplier is given by 1(1−c).
So, when c = 0.6, the multiplier is 2.5.
Was this answer helpful ?
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