If the tax multiplier is -4 and taxes are reduced by $35 billion, output falls by $140 billion. increases by $140 billion. 1. 2.

There is a tax-cut that increases your Disposable Income by $3,400, which you intend to save $510. a. Calculate the MPC. b. Interpret this MPC. (What does it mean? Define MPC and describe in this context.)c. What is the resulting fiscal multiplier? d. Interpret the multiplier and describe the multiplier effect. e. Find the total change to the economy from this tax change.

If the MPS in an economy is 0.2. What is the tax multiplier? Group of answer choices a. 4 b. 5 c. -4 d. -5

An open-economy is characterized by the following: C = 750 +0.8 (Y-T) $$1-1500$$ G = 250 T = 200 X = 800 M = 0.4Y

What is the effect of an increase in taxes when the economy is above full​ employment? What is the magnitude of the tax​ multiplier? An increase in taxes when the economy is above full employment​ _______ aggregate demand and real​ GDP, and the price level​ _______.     A. ​increases; falls   B. ​increases; rises   C. does not​ change; does not change   D. ​decreases; falls The magnitude of the tax multiplier is equal to​ _______.     A. MPC times the government expenditure multiplier   B. the government expenditure multiplier divided by MPC   C. MPC   D. the government expenditure multiplier

Suppose a tax is such that an individual with an income of $10,000 pays $2,500 of tax, a person with an income of $20,000 pays $5,000 of tax, a person with an income of $30,000 pays $7,500 of tax, and so forth. Instructions: Enter your answers rounded to 1 decimal place. a. What is each person's average tax rate? Income Таx Paid Average Tax Rate $ 10,000 $ 2,500 % 20,000 5,000 30,000 7,500

Some politicians have suggested that the United States enact a constitutional amendment requiring that the Federal government balance its budget annually. Such an amendment, f strictly enforced, would force the government to enact a contractionary fiscal policy whenever the economy experienced a severe recession. This is because when the economy enters a recession, 0000 net tax revenue falls and transfer payments rise. Balancing the budget would require raising transfer payments and raising taxes. net tax revenue rises and transfer payments fall. Balancing the budget would require raising transfer payments and lowering taxes. net tax revenue falls and transfer payments rise. Balancing the budget would require lowering transfer payments and raising taxes net tax revenue rises and transfer payments fall. Balancing the budget would require lowering transfer payments and lowering taxes

1 et Question 3 There is an inflationary gap of $40 billion in the economy. The MPC is 75%. What is the MPS [Select] and the Government Spending Multiplier [Select] Government need to [Select] much [Select] change taxes, would they [Select] the Tax multiplier [Select] [Select] ? Would the spending? By how ? If the Government decided to taxes? What is and by how much