Introduction to Economics 2 Deneme Sınavı Sorusu #349548

If the marginal propensities to save and to import are 0.20 and 0.10, respectively, what percentage of income change will be spent on goods and services produced domestically?


0.10

 

0.20

 

0.30

 

0.70

0.90


Yanıt Açıklaması:

Since savings and imports are the leakages from income-expenditure flow the total of these marginal propensities represent the total leakage. Therefore, the rest of this total shows the consumption expenditures made for domestically produced goods and services if we subtract it from 1 (recall that MPC + MPS =1).

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