Given a $500 billion AD shortfall and an MPC of 0.75,the desired fiscal stimulus would be
A) A $2 trillion increase in government expenditures.
B) A $375 billion increase in government expenditures.
C) A $500 billion increase in government expenditures.
D) A $125 billion increase in government expenditures.
Correct Answer:
Verified
Q42: Which of the following explains why the
Q43: Which of the following is the best
Q44: The balanced budget multiplier is equal to
A)0.
B)1.
C)1
Q45: The balanced budget multiplier says that
A)An increase
Q46: Ceteris paribus,if income was transferred from individuals
Q48: A marginal propensity to save (MPS)of 0.25
Q49: Jack has an MPC of 0.82 and
Q50: A tax cut has a smaller impact
Q51: If the government cuts taxes by $200
Q52: Assume the MPC is 0.80.If the government
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