IN AN ECONOMY, CONSUMPTION IS 70% OF PRE-TAX INCOME AND THE AVERA...

21. - MOCK AND SAMPLE EXAMS CFA 2012 L1 SAMPLE EXAM V1 QUESTION 21. - MOCK AND SAMPLE EXAMS CFA 2012 L1 SAMPLE EXAM V1 QUESTION
MOCK AND SAMPLE EXAMS CFA 2012 L1 SAMPLE EXAM V1 QUESTION
21. In an economy, consumption is 70% of pre-tax income and the average tax rate is 25% of total income. If planned government expenditures are expected to increase by $1.25 billion, the increase in total incomes and spending in billions, is closest to: A. $1.3. B. $2.6. C. $4.2.