If the marginal propensity to save is 0.3, the marginal propensity to import is 0.1, and the government increases expenditures by $10 billion, ignoring foreign-income repercussions, how much will gross domestic product (GDP) rise?
A. $10 billion.
B. $15 billion.
C. $20 billion.
D. $25 billion.
Answer: D
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