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Definition of the keynesian multiplier

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Reference no: EM132198866

According to the definition of the Keynesian multiplier, an economy with $10 in investment, a zero government deficit, and a marginal propensity to consume of 0.8 will have an equilibrium level of output of

  1. $80
  2. $50
  3. We cannot tell without knowing the level of wages and taxes on profits
  4. $12.50

Reference no: EM132198866

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