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consider two economies that are identical, with the exception that one has a high marginal propensity to consume (mpc)...

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consider two economies that are identical, with the exception that one has a high marginal propensity to consume (mpc) and one has a low mpc. if the money supply is increased by the same amount in each economy, the high mpc economy will experience 5. O alarger increase in output and a smaller decrease in the interest rate. O a smaller increase in output and a smaller decrease in the interest rate O a larger increase in output and a larger decrease in the interest rate O a smaller increase in output and a larger decrease in the interest rate

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Option A is correct a larger increase in output and small decrease in interest rate Explanat View the full answer


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Economics Principles and Policy

Economics Principles and Policy

ISBN: 978-1305280595

13th edition

Authors: William Baumol, Alan Blinder

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Posted Date: April 16, 2022 07:17:18
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