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Economics for Today 9th Edition by Irvin Tucker
Edition 9ISBN: 978-1305507111Economics for Today 9th Edition by Irvin Tucker
Edition 9ISBN: 978-1305507111 Exercise 13
If the marginal propensity to consume (MPC) is 0.75, a $50 billion decrease in government spending would cause equilibrium output to
A) increase by $50 billion.
B) decrease by $50 billion.
C) increase by $200 billion.
D) decrease by $200 billion.
A) increase by $50 billion.
B) decrease by $50 billion.
C) increase by $200 billion.
D) decrease by $200 billion.
Explanation
Verified
Verified
The formula is: 
Here, MPC=.75. We also...
Economics for Today 9th Edition by Irvin Tucker
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