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  • Jun 1, 2011, 09:45 AM
    Vivio
    Chain effect of increase in exports
    Assume that a 1$ increase in exports increases GDP by 2$, and a 1$ increase in income increases import spending by 0,15$. In this case a 500$million increase in exports will increase net exports by:

    A:650 mill
    B: 350 mill.
    C: 150 mill
    D: 500 mill

    Is B the right answer?

    Thank you !

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