Income has risen in the simple Keynesian model.This could be the result of:,
A)an equal increase in government spending and taxes.
B)an increase in unplanned investment.
C)an increase in taxes
D)a decrease in autonomous consumption.
E)none of the above

Question

Quizplus · Accepted Answer

In the simple Keynesian model, an equal increase in government spending and taxes can lead to an increase in income due to the balanced budget multiplier effect, where the increase in government spending has a direct positive impact on aggregate demand.

Income Has Risen in the Simple Keynesian Model