The spending multiplier with variable net exports is
A) (1 + MPC) /MPM
B) 1/(1 - MPC)
C) 1/(1 - MPC + MPM)
D) 1/(1 - MPC - MPM)
E) MPC/MPM
Correct Answer:
Verified
Q16: An economy that engages in international trade
Q17: The formula for the spending multiplier when
Q18: If variable net exports increase by the
Q19: Adding variable net exports to aggregate expenditure
Q20: The larger the marginal propensity to import,
Q22: If net exports increase by $450 billion
Q23: If the marginal propensity to consume (MPC)
Q24: A more realistic approach has net exports
Q25: Exhibit 10-8 Q26: When net exports are included in the
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