The marginal propensity to save is 0.2. Equilibrium GDP will decrease by $50 billion if the aggregate expenditures schedule decreases by Multiple Choice $10 billion. $250 billion. $25 billion. $5 billion.
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The marginal propensity to save is 0.2. Equilibrium
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$10 billion.
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$250 billion.
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$25 billion.
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$5 billion.
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- The marginal propensity to save is 0.20. Equilibrium GDP will decrease by $75 billion if the aggregate expenditures schedule decreases by. make sure the answer is accurate. Group of answer choices $15 billion. $150 billion. $20 billion. $5 billion.An economy has neither imports nor income taxes. The MPC is 0.75 and the real GDP is $120 billion. The government increases expenditures by $4 billion. The multiplier is _____ and the change in real GDP from the increase in government expenditures is _____ billion.Assume that the MPC is 0.9 and investment falls by $30 billion. What is the change in real GDP? Group of answer choices −$39 billion −$93 billion −$270 billion −$300 billion
- Suppose the president is successful in passing a $10 billion tax increase. Assume that taxes are fixed, the economy is closed, and the marginal propensity to consume is 0.8. What happens to equilibrium GDP? Group of answer choices There is a $50 billion increase in equilibrium GDP. There is a $40 billion decrease in equilibrium GDP. There is a $40 billion increase in equilibrium GDP. There is a $50 billion decrease in equilibrium GDP.Assume that the Equilibrium GDP is $4,000 billion. The Potential GDP is $5,000 billion. The marginal propensity to consume is 4/5 (0.8). By how much and in what direction should government purchases be changed? a. increase by $1,000 billion. c. increase by $100 billion. b. decrease by $1,000 billion. d. increase by $200 billion.Suppose the president is successful in passing a $5 billion tax increase. Assume that taxes are fixed, the economy is closed, and the marginal propensity to consume is 0.75. What happens to equilibrium GDP? There is a $20 billion increase in equilibrium GDP. There is a $20 billion decrease in equilibrium GDP. There is a $15 billion increase in equilibrium GDP. There is a $15 billion decrease in equilibrium GDP.
- If aggregate expenditures increase by $12 billion and equilibrium GDP consequently increases by $48 billion, then the marginal propensity to save in the economy must be: MPC= change in consumption/ change in income so MPC=12/48 or .25 So the MPS is .75 Is this correct?If the MPC in an economy is 0.75, government could close a recessionary expenditure gap of $300 billion by cutting taxes by Multiple Choice $400 billion. $300 billion. $75 billion. $225 billion.Level of investment goes up by 200. What happens with the level of GDP if you know that MPC = 0,8 and net tax rate = 0.1?
- Suppose that the marginal propensity to save is dS dy = 0.21 (in billions of dollars) and that consumption is $9.8 billion when disposable income is $0. Find the national consumption function.•Consumption is C=0.25Y+30•Investment is I=0.2Y+20•Gov’t Spending is G=0.05Ya. Equilibrium Y=___b. Equilibrium C=___c. Equilibrium I=___Suppose 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:
