The marginal propensity to consume

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If the marginal propensity to consume is .8 and autonomous taxes are $50, then an increase in national income of $100 will result in:

A. $80 of new consumption spending.

B. $64 of new consumption spending.

C. $50 of new consumption spending.

D. $90 of new consumption spending.

E. None of above

Require specific calculation steps and explaination

Reference no: EM131424652

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