If the MPC is 0.75,a $200 million transfer payment decrease ultimately

Question

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The MPC (Marginal Propensity to Consume) is the proportion of additional income that a household spends on consumption. In this case, if the MPC is 0.75 and there is a $200 million transfer payment decrease, it means that households will consume 75% of that, which is $150 million. Thus, the overall spending will be reduced by $600 million (3 times $150 million).

If the MPC Is 0