In a certain economy, when income is $400, consumer spending is $350. The value of the multiplier for this economy is 3.125. It follows that, when income is $450, consumer spending is
A)$384. For this economy, an initial impulse of $50 in consumer spending translates into a $146.67 increase in aggregate demand.
B)$384. For this economy, an initial impulse of $50 in consumer spending translates into a $156.25 increase in aggregate demand.
C)$389.38. For this economy, an initial impulse of $50 in consumer spending translates into a $146.67 increase in aggregate demand.
D)$389.38. For this economy, an initial impulse of $50 in consumer spending translates into a $156.25 increase in aggregate demand.

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The Answer of In a certain economy, when income is $400, consumer spending is $350. The value of the multiplier for this economy is 3.125. It follows that, when income is $450, consumer spending is
A)$384. For this economy, an initial impulse of $50 in consumer spending translates into a $146.67 increase in aggregate demand.
B)$384. For this economy, an initial impulse of $50 in consumer spending translates into a $156.25 increase in aggregate demand.
C)$389.38. For this economy, an initial impulse of $50 in consumer spending translates into a $146.67 increase in aggregate demand.
D)$389.38. For this economy, an initial impulse of $50 in consumer spending translates into a $156.25 increase in aggregate demand.

In a Certain Economy, When Income Is $400, Consumer Spending