Which of the following is true?
A) The tax multiplier is smaller than the government spending multiplier.
B) The government cannot stimulate consumer spending through tax cuts.
C) The government spending multiplier is smaller than the tax multiplier.
D) The government can stimulate consumer spending through decreases in transfer payments.
Correct Answer:
Verified
Q54: If the marginal propensity to consume is
Q55: If government increases its purchases by $20
Q56: If the MPC = 3/4, an increase
Q57: If MPC = 0.75, a $40 billion
Q58: If MPC = 0.75, a $40 billion
Q60: If MPC = 0.8, a $200 billion
Q61: Other things equal, an increase in government
Q62: The greater the MPC:
A)the greater the fraction
Q63: The primary benefit of the automatic stabilizers
Q64: If there is initially a federal budget
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