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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 32

An injection of £3 billion of investment spending into an economy has resulted in a £12 billion increase in national income.

All other things being equal, what is the marginal propensity to consume (MPC) in this economy?

0.25

0.75

4.00

1.33

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