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A:
Q: If the MPS in an economy is 0.43, government could shift the aggregate demand curve rightward by $40…
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Q: if the MPC in an economy is .80 government could shift the aggregate demand curve leftward by $48…
A: Answer: Correct option: (A) increasing taxes by $12 billion Explanation: If the government increases…
Q: Suppose the government reduces taxes by $20 billion and that there is no crowding-out effect and the…
A: Answer to the question is as follows :
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A: With the increase in government expenditure, Aggregate Demand shifts to the right by initial…
Q: If the MPS in an economy is .2 government could shift the aggregate demand curve leftward by $20…
A: Multiplier = 1/MPS = 1/0.2 = 5
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- If the MPS in an economy is 0.43, government could shift the aggregate demand curve rightward by $40 billion by increasing government spending by _____ billion dollars.Differentiate the macroeconomic effects that explain the causes of the differences of government spending in aggregate demand. Describe your answer.If the MPS in an economy is 0.25, government could shift the aggregate demand curve leftward by $60 billion by Multiple Choice reducing government expenditures by $15 billion. reducing government expenditures by $240 billion. increasing taxes by $60 billion.
- If the MPS in an economy is 0.1, government could shift the aggregate demand curve rightward by $30 billion bySomeone answer this question ASAP without explanantionA tax cut shifts aggregate demand A. by less than the tax cut. B. by the same amount as the tax cut. C. None of the options are correct. D. by more than the amount of the tax cut.Supply-siders ignore the effects of tax cuts ona, aggregate supply.b. aggregate demand.c, aggregate demand and aggregate supply. d.none of these . Give explanation for answer
- If the MPS in an economy is 0.1, government could shift the aggregate demand curve rightward by $40 billion by( please explain as well ) A) increasing government spending by $4 billion. B) increasing government spending by $40 billion. C) decreasing taxes by $4 billion. D) increasing taxes by $4 billion.The economy is in a recession. The government enacts a policy to increase spending by $2 billion. The MPS is 0.25. What would be the full increase in real GDP from the change in government spending, assuming that the aggregate supply curve is horizontal across the range of GDP being considered? Multiple Choice $8 billion $2 billion $16 billion $4 billionIf the MPS in an economy is .2 government could shift the aggregate demand curve leftward by $20 billion by A. reducing government expenditures by $4 billion B. reducing government expenditures by $100 billion C increasing taxes by $20 billion D. increasing taxes by $200 billion
- Which of the following statements about Fiscal Policy is INCORRECT? choose the correct answer(a) In order to combat inflation, the South African Reserve Bank must apply acontractionary fiscal policy;(b) A contractionary fiscal policy can result in higher levels of unemployment; (c) Expansionary fiscal policy will increase the budget deficit; (d) The application of fiscal policy will have no effect on aggregate supply in theAD‐AS modelIf the MPS in an economy is .4, government could shift the aggregate demand curve leftward by $50 billion by: reducing government expenditures by $125 billion. reducing government expenditures by $20 billion. increasing taxes by $50 billion. increasing taxes by $250 billion.Which of the following statements about Fiscal Policy is INCORRECT?(a) In order to combat inflation, the South African Reserve Bank must apply acontractionary fiscal policy;(b) A contractionary fiscal policy can result in higher levels of unemployment; (c) Expansionary fiscal policy will increase the budget deficit; (d) The application of fiscal policy will have no effect on aggregate supply in the AD‐AS model.