QUESTION 25If the marginal propensity to consume is 0.75, the multiplier for taxes and transfer payments is: a.equal to 4. b.equal to 0.75. c.greater than 4. d.less than 4. QUESTION 26If workers expect a lower rate of inflation, the short-run Phillips curve will: a.shift up. b.remain constant, but there will be a movement down the curve. c.shift down. d.be unaffected.

If the marginal propensity to consume is 0.75, the multiplier for taxes and transfer payments is:…

Answered: If the marginal propensity to consume…

Principles of Economics, 7th Edition (MindTap Course List)

7th Edition

ISBN:9781285165875

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter35: The Short-Run Trade-off Between Inflation And Unemployment

Section: Chapter Questions

Problem 4QCMC

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QUESTION 25

If the marginal propensity to consume is 0.75, the multiplier for taxes and transfer payments is:

a.
equal to 4.

b.
equal to 0.75.

c.
greater than 4.

d.
less than 4.

QUESTION 26

If workers expect a lower rate of inflation, the short-run Phillips curve will:

a.
shift up.

b.
remain constant, but there will be a movement down the curve.

c.
shift down.

d.
be unaffected.

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