Economics (AS & A Level) · May / June 2021 · Paper 32 · Question 24

Government spending in an economy increases by $4000 whilst at the same time investment falls by $1500. marginal propensity to save = 1/10 marginal propensity to tax = 1/5 marginal propensity to import = 1/10 What will be the increase in national income following these changes?

1. A$2500
2. B$6250
3. C$10 000
4. D$25 000

As printed in the paper