Assume that the short run equilibrium GDP is $4,000 billion and the potential GDP is $5,000 billion. The marginal propensity to consume is 0.8. Would you classify this society more inclined to consume or save? Explain .
Assume that the short run equilibrium GDP is $4,000 billion and the potential GDP is $5,000 billion. The marginal propensity to consume is 0.8. Would you classify this society more inclined to consume or save? Explain .
Chapter11: Fiscal Policy
Section: Chapter Questions
Problem 5SQP
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Assume that the short run equilibrium GDP is $4,000 billion and the potential GDP is $5,000 billion. The marginal propensity to consume is 0.8.
Would you classify this society more inclined to consume or save? Explain .
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