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Economics (MindTap Course List)

13th Edition
Roger A. Arnold
ISBN: 9781337617383

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BuyFindarrow_forward

Economics (MindTap Course List)

13th Edition
Roger A. Arnold
ISBN: 9781337617383
Textbook Problem

Explain how a rise in autonomous spending can increase total spending by some multiple.

To determine

Rise in autonomous spending and the total spending.

Explanation

The autonomous consumption is the part of consumption which is independent of the level of disposable income of the consumer. Thus, it can be explained as the level of consumption when the level of income is zero. It is indicated as C0 in the consumption function

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