To ascertain: The reason for not good estimate of MPC.

Question

Question 8 Real GDP in the economy is $7,900 Billion and the Marginal Propensity to Consume is 0.56. What will Real GDP in the economy be, in $ Billions, after a $10 Billion increase in Government Spending? (Round your FINAL answer to the nearest whole number/integer.) (BE VERY CAREFUL NOT TO ROUND "MIDDLE" CALCULATIONS. ONLY ROUND THE FINAL ANSWER.) (Do not enter a dollar sign, $. or the word "Billion", just the number.)

Answer 1

Question

Chapter 8, Problem 8DQ

To determine

To ascertain: The reason for not good estimate of MPC.

Expert Solution & Answer

Trending nowThis is a popular solution!

See solution

Check out sample textbook solution

Students have asked these similar questions

Question 8 Real GDP in the economy is $7,900 Billion and the Marginal Propensity to Consume is 0.56. What will Real GDP in the economy be, in $ Billions, after a $10 Billion increase in Government Spending? (Round your FINAL answer to the nearest whole number/integer.) (BE VERY CAREFUL NOT TO ROUND "MIDDLE" CALCULATIONS. ONLY ROUND THE FINAL ANSWER.) (Do not enter a dollar sign, $. or the word "Billion", just the number.)

Economics 1. Graphing the consumption function from the MPC Consider a hypothetical economy in which the marginal propensity to consume (MPC) is 0.75. That is, if disposable income increases by $1, consumption increases by 75c. Suppose further that last year disposable income in the economy was $500 billion and consumption was $400 billion. On the following graph, use the blue line (aircle symbol) to plot this economy's consumption function based on these data. (?) 700 600 300 -100 400 500 600 700 100 200 300 DISPOSABLE INCOME (Blions of dotans) From the preceding data, you know that the level of savings in the economy last vear was s billion and the marginal propensity to save in this economy is Suppose that this year, disposable income is projected to be $700 billion. Based on your analysis, you would expect consumption to be S billion and savings to be S billion, CONSUMPTION (Bilions of dolars)

Economics 1. Graphing the consumption function from the MPC Consider a hypothetical economy in which the marginal propensity to consume (MPC) is 0.75. That is, if disposable income increases by $1, consumption increases by 75c. Suppose further that last year disposable income in the economy was $500 billion and consumption was $400 billion. On the following graph, use the blue line (aircle symbol) to plot this economy's consumption function based on these data. 700 600 300 -100 300 400 500 600 700 100 200 DISPOSABLE INCOME (Blions of dotani) From the preceding data, you know that the level of savings in the economy last vear was s billion and the marginal propensity to save in this economy is Suppose that this year, disposable income is projected to be $700 billion. Based on your analysis, you would expect consumption to be S billion and savings to be s billion, CONSUMPTION (Blions of dolars)