If the MPC is .70 and gross investment increases by $3 billion, the equilibrium GDP will:

Name: If the MPC is .70 and gross investment increases by $3 billion, the equilibrium GDP will:
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The multiplier effect is calculated as 1/(1-MPC). With an MPC of 0.70, the multiplier is 1/(1-0.70) = 3.33. Therefore, an increase in investment of $3 billion will increase the equilibrium GDP by 3.33 * $3 billion = $10 billion.

If the MPC Is