Suppose that the marginal propensity to consume is 0.8, and investment spending increases by $100 billion. The increase in aggregate demand is: ☐ a) ○ b) $125 billion, composed of $100 billion in investment spending and $25 billion in consumption. $500 billion, composed of $100 billion in investment spending and $400 billion in consumption. c) $100 billion, the amount of investment spending. d) $80 billion, composed of $100 billion in investment spending and a decrease in consumption of $20 billion.

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