If the marginal propensity to consume is 0.6; full employment income is $1,000; and the current equilibrium is $750, a(n) _____ gap exists, such that a(n) _____ in spending equal to _____ is needed to close the gap.
A) inflationary; decrease; $100
B) inflationary; decrease; $250
C) recessionary; increase; $100
D) recessionary; increase; $250

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The Answer of If the marginal propensity to consume is 0.6; full employment income is $1,000; and the current equilibrium is $750, a(n) _____ gap exists, such that a(n) _____ in spending equal to _____ is needed to close the gap.
A) inflationary; decrease; $100
B) inflationary; decrease; $250
C) recessionary; increase; $100
D) recessionary; increase; $250

If the Marginal Propensity to Consume Is 0