If the marginal propensity to consume is 4/5, the multiplier is:
A) 20.
B) 5.
C) 1.
D) 1/5.
Correct Answer:
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Q19: In the short run, fiscal policy has
Q20: The effect of a tax multiplier on
Q21: Budget surpluses exist when:
A)government spending exceeds its
Q22: How does a change in taxes primarily
Q23: Other things equal, contractionary fiscal policy will
Q25: The issuance of debt involves some intergenerational
Q26: Among the following MPC values, which one
Q27: The extent of the multiplier effect visible
Q28: Expansionary fiscal policy consists of:
A)increased government purchases
Q29: The main components of spending, which can
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