With the economy in a recession due to inadequateaggregate demand, the government increases itspurchases by $1,200. Suppose the central bankadjusts the money supply to hold the interest rateconstant, investment spending remains unchanged,and the marginal propensity to consume is 23. Howlarge is the increase in aggregate demand?a. $400b. $800c. $1,800d. $3,600

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