The most likely source of an increase in investment is a. Interest rates that are lower b. Expected increases in national income c. The marginal propensity to consume is decreasing d.
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The most likely source of an increase in investment is
a. Interest rates that are lower
b. Expected increases in
c. The marginal propensity to consume is decreasing
d.
Step by step
Solved in 2 steps
- Calculate the value of Consumption when average propensity to consume is 0.7 and the income is 700 (b) Can the value of APC greater than 1The marginal propensity to consume is 0.75. What will be the initial change in consumption when? 1) Taxes fall by $20 billion 2) Taxes rise by $40 billion 3) A recession leads to a reduction in personal income of $500 billionIn an economy the marginal propensity to consume is 0.9 and increase in investment is of 100 million dollars. Find out the increase in national income.
- Macroeconomics: Assuming marginal propensity to consume is 0.5. If there is a shock to the economy that increases investment spending by 200 billion dollars what will the total Change to GDP be? (Ignore taxes and imports)f the marginal propensity to consume is 0.75 and the federal government decreases spending by $200 billion the income-expenditure model predicts that real GDP will fall by: $750 billion $150 billion $1000 billion $800 billionThe maginal propensity to consume of country is 0.8 and the country increases its investment by 5 billion. Calculate the marginal propensity to save.
- Autonomous consumption = R100m Investment spending = R300m Government spending = R200 million Exports = R150 millionAutonomous imports = R100 million Marginal propensity to consume =2/3 Tax rate = 1/10Marginal propensity to import = 1/10 Yf = R2 150 million. Calculate the equilibrium level of income.Determine the change in the equilibrium level of consumption (find ΔC) following a decrease in government spending from 400 to 300 (ΔG = -$100). A: positive 400$ B: negative 300 c: negative 400 D: positive 300If the recessionary gap is $ 200 billion and the multiplier is 2, what is the increase in aggregate spending needed to bring the economy to full employment? a)$300 billion b)$ 600 billion c)$200 billion d) $66.6 billion
- Calculate income if Average propensity to consume is 0.77 and the consumption is $400Nigeria is currently experiencing a recessionary gap of approximately 24.6 billion krone. Its MPC is approximately 0.8. How much would the government have to change spending to close the gap? Assume a horizontal SRAS. If the government should decrease spending, enter a negative answer. one decimal plInitital $10 increase in investment expands GDP by $10 in first round of multiplier process. the 2nd round both GDP and Consumption rise $6. 1. what is the Marginal Propensity to Consume? 2. What is the size of the mulitplyer?
