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2.2 How the macroeconomy works: the circular flow of income, aggregate demand/aggregate supply analysis and related concepts

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Question 4

The marginal propensity to consume (MPC) in an economy is 0.6. If the MPC increases by 25%, the new value of its multiplier will be:

1.331.331.33

2.502.502.50

4.004.004.00

6.676.676.67

2.2 How the macroeconomy works: the circular flow of income, aggregate demand/aggregate supply analysis and related concepts Questions

  1. A Level
  2. /Economics
  3. /2.2 How the macroeconomy works: the circular flow of income, aggregate demand/aggregate supply analysis and related concepts