A $100 billion decrease in government purchases would:
A) increase AD by $500 billion if MPC = 0.8.
B) decrease AD by $300 billion if MPC = 2/3.
C) increase AD by $200 billion if MPC = 0.5.
D) decrease AD by $40 billion if MPC = 0.4.
Correct Answer:
Verified
Q41: A $100 billion increase in government purchases
Q42: If MPC = 2/3, a decrease in
Q43: If government policy makers were worried about
Q44: If net exports increase by $10 billion
Q45: If investment decreases by $20 billion and
Q47: If MPC = 0.75, a $40 billion
Q48: In order for the economy pictured to
Q49: If the government decides to spend an
Q50: Assume that there is a $20 billion
Q51: If government policy makers were worried about
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