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Suppose That the Economy's Marginal Propensity to Save Is 0

Question 30

Multiple Choice

Suppose that the economy's marginal propensity to save is 0.2. Assuming that prices are constant, a $30 million decrease in net exports would decrease equilibrium real GDP by


A) $60 million
B) $90 million
C) $120 million
D) $150 million

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