Multiplier principle. Suppose that Congress enacts a one-time-only 10% tax rebate that is expected to infuse $ y billion, 5 ≤ y ≤ 7, into the economy. If every person and every corporation is expected to spend a proportion x, 0.6 ≤ x ≤ 0.8, of each dollar received, then, by the multiplier principle in economics, the total amount of spending S (in billions of dollars) generated by this tax rebate is given by S ( x , y ) = y 1 − x What is the average total amount of spending for the indicated ranges of the values of x and y ? Set up a double integral and evaluate it.
Multiplier principle. Suppose that Congress enacts a one-time-only 10% tax rebate that is expected to infuse $ y billion, 5 ≤ y ≤ 7, into the economy. If every person and every corporation is expected to spend a proportion x, 0.6 ≤ x ≤ 0.8, of each dollar received, then, by the multiplier principle in economics, the total amount of spending S (in billions of dollars) generated by this tax rebate is given by S ( x , y ) = y 1 − x What is the average total amount of spending for the indicated ranges of the values of x and y ? Set up a double integral and evaluate it.
Solution Summary: The author calculates the average total amount of spending for the indicated ranges of the values of x and y.
Multiplier principle. Suppose that Congress enacts a one-time-only 10% tax rebate that is expected to infuse $y billion, 5 ≤ y ≤ 7, into the economy. If every person and every corporation is expected to spend a proportion x, 0.6 ≤ x ≤ 0.8, of each dollar received, then, by the multiplier principle in economics, the total amount of spending S (in billions of dollars) generated by this tax rebate is given by
S
(
x
,
y
)
=
y
1
−
x
What is the average total amount of spending for the indicated ranges of the values of x and y? Set up a double integral and evaluate it.
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