An economy has a fixed price level, no imports, and no income taxes. MPC is 0.8, and real GDP is $300 billion. Businesse

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An Economy Has A Fixed Price Level No Imports And No Income Taxes Mpc Is 0 8 And Real Gdp Is 300 Billion Businesse 1 (24.9 KiB) Viewed 44 times

An economy has a fixed price level, no imports, and no income taxes. MPC is 0.8, and real GDP is $300 billion. Businesses increase investment by $10 billion Calculate the new level of real GDP and explain why real GDP increases by more than $10 billion. The new level of real GDP is $ billion. Real GDP increases by more than $10 billion because the increase in investment A. Increases the marginal propensity to consume B. induces an increase in consumption expenditure c. enables firms to produce more output D. Increases exports