If the marginal propensity to consume is 0.8 and the real national income needs to be increased by $500 billion,then
A) consumption spending needs to increase by $500 billion.
B) saving needs to be reduced by $500 billion in order to generate the extra $500 billion.
C) an increase in investment spending of $200 billion is needed to generate the desired increase of $500 billion.
D) an increase in autonomous spending of $100 billion will lead to the increase of $500 billion.
Correct Answer:
Verified
Q77: When real national income exceeds total expenditures,
A)there
Q78: Figure 9-4 Q79: Suppose the equilibrium level for an economy Q80: In the Keynesian model,government spending is considered Q81: A permanent reduction in investment spending leads Q83: If the multiplier is 4,the marginal propensity Q84: If an increase of $5 billion in Q85: If the marginal propensity to save is Q86: If the multiplier in the economy is Q87: An increase in net exports leads to
A)a
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