If the marginal propensity to consume is 0.8 and the fiscal policy goal is to increase real national income needs to by $500 billion, then
A) government spending needs to increase by $500 billion.
B) government spending needs to increase by $100 billion.
C) saving needs to increase by $500 billion.
D) saving needs to increase by $100 billion.
Correct Answer:
Verified
Q33: Increases in the marginal propensity to consume
Q34: If investment spending increases by $1 billion
Q35: If investment spending increases by $1 billion
Q36: If the marginal propensity to consume is
Q37: If the marginal propensity to consume is
Q39: If the marginal propensity to consume is
Q40: If the marginal propensity to consume is
Q41: What is the multiplier when the marginal
Q42: An increase in aggregate demand when aggregate
Q43: Contractionary fiscal policy is used when
A) the
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