Economics For Today
10th Edition
ISBN: 9781337613040
Author: Tucker
Publisher: Cengage Learning
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Question
Chapter 19, Problem 9SQ
To determine
The formula to calculate the spending multiplier.
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Students have asked these similar questions
If an economy’s spending multiplier is equal to 4, what is its MPC and MPS?
If the multiplier is 5, then the MPC is
Answer
0.05
0.5
0.6
0.8
Question 43
In a certain economy, when income is $200, consumer spending is $145. The value of the multiplier for this economy is 6.25. It follows that, when income is $230, consumer spending is
Answer
$151.25.
$166.75.
$170.20.
$175.00.
The multiplier is
Multiple Choice
1/(1
+ MPC.
1/MPS.
1/(1- MPS).
1/MPC.
Chapter 19 Solutions
Economics For Today
Ch. 19.4 - Prob. 1YTECh. 19 - Prob. 1SQPCh. 19 - Prob. 2SQPCh. 19 - Prob. 3SQPCh. 19 - Prob. 4SQPCh. 19 - Prob. 5SQPCh. 19 - Prob. 6SQPCh. 19 - Prob. 7SQPCh. 19 - Prob. 8SQPCh. 19 - Prob. 9SQP
Ch. 19 - Prob. 10SQPCh. 19 - Prob. 1SQCh. 19 - Prob. 2SQCh. 19 - Prob. 3SQCh. 19 - Prob. 4SQCh. 19 - Prob. 5SQCh. 19 - Prob. 6SQCh. 19 - Prob. 7SQCh. 19 - Prob. 8SQCh. 19 - Prob. 9SQCh. 19 - Prob. 10SQCh. 19 - Prob. 11SQCh. 19 - Prob. 12SQCh. 19 - Prob. 13SQCh. 19 - Prob. 14SQCh. 19 - Prob. 15SQCh. 19 - Prob. 16SQCh. 19 - Prob. 17SQCh. 19 - Prob. 18SQCh. 19 - Prob. 19SQCh. 19 - Prob. 20SQ
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Similar questions
- Calculate MPC, MPS and the Multiplier if consumption expenditure increases by $4,000 as a result of increase in income from $40,000 to $46,000.arrow_forwardConsumption = 115 + 0.6Y Investment = 550 What is the value of autonomous spending , the value of the multiplier and the equilibrium level of incomearrow_forwardSuppose that the MPC is .75 and the MPM is .1. What is the size of the multiplier?arrow_forward
- The spending multiplier, m, is V/1- MPC). a) f the MPC is 0.9, what is the spending mutiplier? b) Now suppose government spending increases by $90 million. By how much will GDP rise? millionarrow_forwardIf a rise in national income of £100m causes consumption of domestic goods and services to rise by £60m, the multiplier isarrow_forwardI'm doing economics homework and I'm being asked to find the multiplier when the MPS is 0.12 and MPC is 0.88. I'm trying to follow the formula and not sure where I'm getting lost.arrow_forward
- If marginal propensity to save is 0.22 Calculate the value of k(Multiplier)arrow_forwardWe have observed that consumption is 100 when income is 0 and consumption is 400 when income is 500. What is the spending multiplier? 1 2.5 3.5 4arrow_forwardWith an MPC of 0.8, government spending increases $20 billion while taxes decrease $10 billion. Based on this data, what is the cumulative effect on GDP?arrow_forward
- In Altus, income rose by $80 billion over the past year. During the same period, its aggregate expenditures increased by $55. What are the values of its MPE, MLR and multiplier?arrow_forwardA company is growing rapidly, and is investing nearly all of its income, so its marginal propensity to consume (MPC) is 0.85. Remembering that MPC + MPS equals 1, we find out that the MPS is 0.15. What is the spending multiplier in this case?arrow_forward
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