What is the government purchases multiplier if the tax rate is 0.1 and the marginal propensity to consume is 0.9? Assume the economy is closed.
A) 10
B) 11.1
C) 5.3
D) 100
Correct Answer:
Verified
Q66: Assume that the federal government gives a
Q68: Suppose real GDP is $1.3 trillion and
Q69: Outline the differences between the government 'purchases
Q72: Induced taxes and transfer payments reduce the
Q77: The government purchases multiplier will be larger
Q87: Suppose that the government allocates $1 billion
Q88: Using the following table,answer the following questions.The
Q178: In the case of an upward-sloping aggregate
Q242: If the multiplier is 10,the marginal propensity
Q255: Would a larger multiplier lead to longer
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents