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In the Simple Keynesian Model,if the Tax Function Is Given

Question 17

Multiple Choice

In the simple Keynesian model,if the tax function is given by T = 0.15Y and the consumption function is C = 50 + 0.7YD then a 10-unit increase in government spending would increase equilibrium income by


A) 10 units.
B) 11.2 units.
C) 22.4 units.
D) 30 units.
E) none of the above

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