Increase in equilibrium level of national income

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In an economy, the marginal propensity to consume is 0.8. The government balances the budget by adjusting the proportional tax level to the required government spending. An increase by 10 million in government required spending will lead to an increase in equilibrium level of national income by: (a) 10 (b) 50 (c) 20 (d) 30

Reference no: EM131097604

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