Consider an economy where the marginal propensity to save is 0.15; the marginal propensity to import is 0.05 and the marginal propensity to tax is 0.2. If there is an increase in government spending of $150 million, by how much would national income increase? (a) National income would increase by $350 million (b) National income would increase by $375 million (c) National income would increase by $210 million (d) National income would increase by $240 million
Consider an economy where the marginal propensity to save is 0.15; the marginal propensity to import is 0.05 and the marginal propensity to tax is 0.2. If there is an increase in government spending of $150 million, by how much would national income increase? (a) National income would increase by $350 million (b) National income would increase by $375 million (c) National income would increase by $210 million (d) National income would increase by $240 million
Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter18: Six Debates Over Macroeconomic Policy
Section: Chapter Questions
Problem 6CQQ
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Consider an economy where the marginal propensity to save is 0.15; the marginal propensity to import is 0.05 and the marginal propensity to tax is 0.2. If there is an increase in government spending of $150 million, by how much would
(a) National income would increase by $350 million
(b) National income would increase by $375 million
(c) National income would increase by $210 million
(d) National income would increase by $240 million
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