he Marginal Propensity to Consume (MPC) is 0,8 and the government wants total spending to increase by $40 Billion. How much the multiplier and initial spending must the government do to achieve the goal? (Assume economy is at full employment and economist ignore possibility of crowding out effect)
he Marginal Propensity to Consume (MPC) is 0,8 and the government wants total spending to increase by $40 Billion. How much the multiplier and initial spending must the government do to achieve the goal? (Assume economy is at full employment and economist ignore possibility of crowding out effect)
Chapter9: Aggregate Demand
Section: Chapter Questions
Problem 5.12P
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b. The Marginal Propensity to Consume (MPC) is 0,8 and the government wants total spending to increase by $40 Billion. How much the multiplier and initial spending must the government do to achieve the goal? (Assume economy is at full employment and economist ignore possibility of crowding out effect)
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