If national income increases by $20 million and consumption increases by $5 million, the marginal propensity to consume is A) 4. B) 0.75. C) 0.5. D) 0.25.
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A: We know, from the fundamental macroeconomic identity, Y = C(Y - T) + I + G Where Y represents the…
Q: Suppose that autonomous consumption (a) is 200, private investment spending (I) is 340, government…
A: Given - a = 200, I = 340, G = 300, T = 300, b = 0.8, t = 0.25
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A: We are given with the value of marginal propensity to save as:- MPS = 0.22 Multiplier = k = ?
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Q: As shown in Exhibit 8-2, the marginal propensity to consume (MPC) is:
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Q: Suppose that autonomous consumption (a) is 200, private investment spending (I) is 340, government…
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A: Government purchases of goods and services increased by = $75000 MPC = 0.75
Q: As shown in Exhibit 2, the marginal propensity to consume (MPC) is: Group of answer choices 0.33.…
A: Marginal propensity to consume (MPC) refers to the value of additional consumption due to increase…
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A: Formula for multiplier=1/1-MPC.
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- DisposableIncomeYd ConsumptionC $2,000 $2,040 2,100 2,120 2,200 2,200 2,300 2,280 2,400 2,360 Refer to Exhibit 10-3. The marginal propensity to consume (MPC) is ___________?3.Suppose the marginal propensity to consume (MPC) equals 0.75. An increase in autonomous investment of $200 will lead to an increase in real Gross Domestic Product (GDP) by Part 2 A. $750. B. $1,000. C. $200. D. $800.Consumption ($) Disposable Income ($) 1,200 3,200 2,100 4,000 3,000 4,800 Calculate the Marginal Propensity to Consume (MPC). Group of answer choices 1.125 0.6 0.3 0.9
- An increase of R5 billion in income in a macroeconomy leads to an increase in R3billion in consumption spending. From this information, we can determine that themarginal propensity to save in this economy is:choose the correct answer(a) 0.6; (b) 0.5;(c) 0.3; (d) 0.4Suppose that the level of government spending increased by $100 billion where the marginal propensity to consume is 0.5. Aggregate expenditures must have increased by:18. According to the income and consumption schedules shown above, the marginal propensity to consume is(A) 1.33(B) 0.90(C) 0.80(D) 0.75(E) decreasing as real disposable income How come MPC equals 0.75?
- If value of MP S is 0.25 what is the value of marginal propensity to consume.If consumption is $5 billion when disposable income is $0 and if the marginal propensity to consume is dC/dy =1/(square root of y+1)+ 0.9 (in billions of dollars) find the national consumption function.If the MPS rises, then the MPC will: a. Fall b. Rise c. Stay the same In what direction will each of the following occurrences shift the consumption and saving schedules, other things equal? a. A large decrease in real estate values, including private homes. b. A sharp, sustained increase in stock prices. c. A 5-year increase in the minimum age for collecting Social Security benefits. d. An economywide expectation that a recession is over and that a robust expansion will occur. e. A substantial increase in household borrowing to finance auto purchases. Irving owns a chain of movie theaters. He is considering whether he should build a new theather downtown. The expected rate of return is 15 percent per year. He can borrow money at a 12 percent interest rate to finance the project. Should Irving proceed with this project? Which of the following scenarios will shift the investment demand curve right? (Select one or more answers) a. Business taxes increase b. The expected return…
- The average propensity to consume refers to the Group of answer choices percentage of income spent for current consumption expenditures for the minimum necessities of life percentage of income saved dollars of income spent for current consumption fact that people with higher incomes spend more for the necessities of lifeQuestion 3: At a level of National Income of AED 30,000 Million, the government announced an increase in expenditures from AED 1000 Million to AED 1500 Million as a stimulus package for infrastructure development and at the same time government also announced an increase in tax from AED 1000 Million to AED 1600 Million. The marginal propensity to consume (MPC) for the country is 0.75. Find the impact of these changes on National Income. Explain the leakages of multiplier61)If the marginal propensity to save is 0.2, then a $10,000 decrease in disposable income will Select one: a. increase consumption by $2,000. b. increase consumption by $8,000. c. decrease consumption by $8,000. d. decrease consumption by $2,000.