In which one of the following situations is the "multiplier" for a given autonomous change in investment spending the largest?
A) MPS = 0.4, MPM = 0.2, t = 0.25
B) MPS = 0.4, t = 0.25 and the economy has no foreign trade.
C) MPS = 0.25, MPM = 0.1, t = 0.2
D) MPS = 0.25, MPM = 0.1, t = 0.2, and the economy has "foreign "repercussions."
Correct Answer:
Verified
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