A marginal propensity to save (MPS) of 0.25 means a $50 million tax cut ultimately
A) Reduces spending by $50 million.
B) Increases spending by $400 million.
C) Increases spending by $200 million.
D) Increases spending by $150 million.
Correct Answer:
Verified
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
Q47: Given a $500 billion AD shortfall and
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
Q53: If the desired fiscal stimulus is $20
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