Suppose the government reduces taxes by 50,000,000, that there is no crowding out, and that marginal propensity to consume is 0.9. What is the total amount of additional economic activity that results from this tax cut?

Suppose the marginal propensity to consume is 0.81. What is the tax multiplier?   Multiple Choice   0.19   0.23   -4.26   -0.19

1. Consider an economy with the initial equilibrium income level of $1000 and the consumption function of C = $150 + 0.6 (Y - T). Find the following quantities:a. Government expenditures at the equilibrium level of income if T = $160 and I = $100.b. The change in income produced by increasing taxes 10%, provided that G and I remain unchanged. What is the tax multiplier?c. The change in income produced by increasing government expenditures 10%, provided that T and I remain unchanged. What is the government spending multiplier?d. Based on your answers to (b) and (c), does the balanced budget multiplier theorem hold?

In the above figures, supposed that there is no import or proportional tax. To pull the economy back to the long-run equilibrium, the government can increase spending by $ trillion.     1)  1   2)  2   3)  8   4)  4

The economy is described by the following functions: C = C+c.YD Tx = t.Y Tr Tr I %3D G = Nx = Nx where t is the tax rate. Note the difference with the setup derived in class: here, the amount of taxes collected depends positively on the gross income. • Q1. Express equilibrium output as function of other variables • Q2. Find the multiplier associated with government purchases. How does this multiplier compare with that obtained in class (i.e. for a model with lump-sum taxes?)

In the above figures, supposed that there is no import or proportional tax. To pull the economy back to the long-run equilibrium, the government can cut taxes by $ trillion.     1)  4   2)  8   3)  1.33   4)  2.67

Our economics have redone their calculations. They now estimate that citizensin our country have an MPC of 0.60. We can fix the problem by decreasing GDP by 250. How much should we increase taxes?

Which type of discretionary fiscal policy is likely to have the smallest overall effect on GDP because of the low MPC related to the policy?

Suppose actual real GDP is $13.74 trillion, potential real GDP is $12.69 trillion, and the marginal propensity to consume is 0.6. If we ignore price effects, and if the government already decided to increase its spending by $1.61 trillion, by how many trillions of dollars should the government change its lump sum taxes to fix the gap? (Round this to two digits after the decimal and enter this value as either a positive value or a negative value without the dollar sign.)  Correct Answer: 3.38  Please solve to get that same answer

Suppose the tax multiplier in an economy is -8. If the government wants to lower total spending (TS) by $8000 what should they do to Taxes (T)? Group of answer choices a. they should increase taxes by $64000 b. they should decrease taxes by $64000 c. they should increase taxes by $1000 d. they should decrease taxes by $1000