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Question
What does \[c\] represent in \[Y=\overline{C}+\overline{I}+cY\]?
Options
Autonomous Consumption
Consumption expenditure
Change in inventories
Marginal Propensity to Consume (MPC)
MCQ
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Solution
The symbol \[c\] represents the Marginal Propensity to Consume (MPC). The term \[cY\] is the income-related part of consumption expenditure.
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