The MPC is 0.90 and there are no income taxes or imports. If government expenditures on goods and services increases by $2.0 billion, after the multiplier effect works out, aggregate expenditure increases by
A)$20 billion.
B)$1.8 billion.
C)$2.22 billion.
D)$2.0 billion.
E)$10 billion.

Question

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The Answer of The MPC is 0.90 and there are no income taxes or imports. If government expenditures on goods and services increases by $2.0 billion, after the multiplier effect works out, aggregate expenditure increases by
A)$20 billion.
B)$1.8 billion.
C)$2.22 billion.
D)$2.0 billion.
E)$10 billion.

The MPC Is 0