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Propensity to consume out of disposable income

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An economy's marginal propensity to consume out of disposable income is 0.75, its marginal and average tax rate is 0.15, and its marginal and average propensity to import is 0.15. What is the increase in government expenditure needed to prevent a fall in equilibrium income of 20 billion Dollar?

Reference no: EM13904821

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