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Question
Situation 20-1
Assume a closed economy with no government. Suppose that autonomous consumption equals $400, planned investment equals $500, and the mpc equals 0.9.
Using the information contained in Situation 20-1, if planned investment decreases by $100, the equilibrium aggregate output will change by
A) -$1,000.
B) $-100.
C) $100.
D) $1,000.
Answer
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