Suppose disposable income increases from $5 billion to $6 billion. As a result, consumption expenditure increases from $4 billion to ________. This result means the MPC equals ________.
A) $4.5 billion; 4.50
B) $4.8 billion; 0.80
C) $5 billion; 0.80
D) $6 billion; 1.00
Correct Answer:
Verified
Q104: Q105: Suppose the consumption function is given by Q106: Q107: The vertical distance between the 45- degree Q108: Q110: Actual aggregate expenditure is Q111: Suppose that, in 2012, firms discover that Q112: Because the short-run aggregate expenditure model assumes Q113: If the multiplier is 4 and there Q304: 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
A)always equal to real
