The desired tax cut to close a GDP gap is given by
A) AD shortfall × MPS.
B) Desired fiscal stimulus ÷ MPC.
C) AD shortfall ÷ MPC.
D) Desired fiscal stimulus × MPC.
Correct Answer:
Verified
Q31: If the MPC equals 0.80,a $200 billion
Q32: The "naïve" Keynesian model is unrealistic because
Q33: A tax cut has a smaller impact
Q34: To eliminate an AD shortfall of $100
Q35: Assume the MPC is 0.80.If the government
Q37: Ceteris paribus,if the AD shortfall equals $600
Q38: The general formula for calculating the desired
Q39: Which of the following explains why the
Q40: Ceteris paribus,if income was transferred from individuals
Q41: Which of the following is a policy
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