Assume that the marginal propensity to save is 0.20 and that the economy is in equilibrium with aggregate expenditure equal to $4,000 billion. If aggregate expenditure falls to $3,500 billion, then the aggregate expenditure curve will shift
a. upward and national income will increase by $2,500 billion
b. downward and national income will decrease by $2,500 billion
c. upward and national income will increase by $100 billion
d. downward and national income will decrease by $100 billion
e. downward and national income will decrease by $100 billion
B
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