Suppose we observe that an increase in government spending of $10 billion raises the total aggregate demand by $40 billion.If there is no crowding-out effect, what would be the marginal propensity?
A)0.25
B)0.4
C)0.75
D)4

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The Answer of Suppose we observe that an increase in government spending of $10 billion raises the total aggregate demand by $40 billion.If there is no crowding-out effect, what would be the marginal propensity?
A)0.25
B)0.4
C)0.75
D)4

Suppose We Observe That an Increase in Government Spending of $10