Within the simple Keynesian model with lump-sum taxes, if the MPC (b)
Within the simple Keynesian model with lump-sum taxes, if the MPC (b) were 0.75 then if taxes rise by $200 then income
a. rises by $800.
b. falls by $200.
c. falls by $800.
d. rises by $200.
e. falls by $800.
ANSWER
E
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