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If an Increase in Government Spending of 40 Units Accompanied

Question 15

Multiple Choice

If an increase in government spending of 40 units accompanied by an equal increase in taxes caused equilibrium income to rise by 40 units,the autonomous expenditure multiplier must be


A) 10.
B) 1.
C) 4.
D) not enough information is given to calculate the multiplier.

Correct Answer:

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