If the MPS in an economy is 0.25, government could shift the aggregate demand curve rightward by $64 billion byMultiple Choicedecreasing taxes by $16 billion.O increasing taxes by $16 billion.increasing government spending by $16 billion.increasing government spending by $64 billion.

Here, it is given that the MPS is 0.25 and government wants to increase aggregate demand by $64…

If the MPS in an economy is 0.25. government could shift the aggregate demand curve rightward by $64 billion by Multiple Choice O decreasing taxes by $16 billion. increasing taxes by $16 billion. increasing government spending by $16 billion. increasing government spending by $64 billion.

If the MPS in an economy is 0.25. government could shift the aggregate demand curve rightward by $64 billion by Multiple Choice O decreasing taxes by $16 billion. increasing taxes by $16 billion. increasing government spending by $16 billion. increasing government spending by $64 billion.

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter11: Fiscal Policy

Section: Chapter Questions

Problem 1.4P

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Question

If the MPS in an economy is 0.25, government could shift the aggregate demand curve rightward by $64 billion by
Multiple Choice
decreasing taxes by $16 billion.
O increasing taxes by $16 billion.
increasing government spending by $16 billion.
increasing government spending by $64 billion.

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