Example 7.2
Y=C+I+G+X-Z
Consumption C = 25 + 0.8(Y - T)
Investment I = 75
Government expenditure G = 70
X=30
Z = 0.14Y
T = 0.2Y
-Refer to Example 7.2. The multiplier for this economy is:
A) 4.
B) 2.
C) 3.
D) 2.33.
Correct Answer:
Verified
Q84: Other things equal, a decrease in an
Q85: Q86: Q87: If exports decrease from positive values to Q88: Example 7.1 Q90: Example 7.2 Q91: Example 7.2 Q92: Example 7.2 Q93: In an open economy with constant prices, Q94: Effectiveness of fiscal policy is dampened due![]()
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Y=C+I+G
Consumption: C = 40 + .8Y
Investment
Y=C+I+G+X-Z
Consumption C = 25 + 0.8(Y
Y=C+I+G+X-Z
Consumption C = 25 + 0.8(Y
Y=C+I+G+X-Z
Consumption C = 25 + 0.8(Y
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