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1-Complete the accompanying table. Level of output and income (GDP = DI) ConsumptionSaving APC APS MPC MPS $100 -$5 125 150 5 175 10 200

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1-Complete the accompanying table. Level of output and income (GDP = DI) ConsumptionSaving APC APS MPC MPS $100 -$5 125 150 5 175 10 200 15 225 20 250 25 275 30 300 35 (a) What is the break-even level of income? How is it possible for households to dissave at very low income levels? (b ) If the proportion of total income consumed decreases and the proportion saved increases as income rises, explain how the MPC and MPS can be constant at various levels of income. 2-Use the following data to answer the questions. Cumulative amount Expected rate of investment of return (billions) 11% $ 55 75 90 105 150 190 (a) Explain why this table is essentially an investment demand schedule. (b) If the interest rate was 8%, how much investment would be undertaken? (c ) Why is there an inverse relationship between the rate of interest and the amount of investment

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