Skip to question Assume that the parameters of a particular economy are as follows (all figures are in $billions): C = 100 + 0.75Y I = 50 Refer to the above information to answer this question. If investment were to increase by $25, then what would happen to equilibrium income? Multiple Choice

Skip to question Assume that the parameters of a particular economy are as follows (all figures are in $billions): C = 100 + 0.75Y I = 50 Refer to the above information to answer this question. If investment were to increase by $25, then what would happen to equilibrium income? Multiple Choice

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter23: The Aggregate Expenditure Model

Section: Chapter Questions

Problem 1P

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Assume that the parameters of a particular economy are as follows (all figures are in $billions):

C = 100 + 0.75Y I = 50

Refer to the above information to answer this question. If investment were to increase by $25, then what would happen to equilibrium income?

Multiple Choice

It would increase by $100.
It would decrease by $100.
It would increase by $25.
It would increase by $18.75.
It would decrease by $18.75.

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