Economics (AS & A Level) · Oct / Nov 2021 · Paper 32 · Question 25
9708The circular flow of income
In a closed economy with no government sector the marginal propensity to consume is 0.6 at all levels of income. There is an increase in private sector investment of $100 million. What will be the increase in national income?
- A$60 million
- B$100 million
- C$166 million
- D$250 million
As printed in the paper
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Correct answer: D. $250 million
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