Exploring Macroeconomics
8th Edition
ISBN: 9781544337722
Author: Robert L. Sexton
Publisher: SAGE Publications, Inc
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Question
Chapter 16, Problem 7P
To determine
(a)
To compute:
The value of multiplier if the marginal propensity to consume was
To determine
(b)
To compute:
The value of multiplier if the marginal propensity to consume was
To determine
(c)
To compute:
The value of multiplier if the marginal propensity to consume was
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How do you calculate marginal propensity to consume and how does it effects the multiplier?
1.3. What is the value of marginal propensity to consume (mpc)? What does it mean?
What is the relationship between the marginal propensity to consume (mpc) and the multiplier?
Chapter 16 Solutions
Exploring Macroeconomics
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- If the marginal propensity to consume is 0.95, Instructions: In part a, enter your response as a whole number. In part b, ent a. What is the value of the multiplier? b. What is the marginal propensity to save?arrow_forwardIf the marginal propensity to consume is 0.75 then what is the marginal propensity to save?arrow_forwardWould each of the following lead to a decrease in national income? a. An increase in imports (Click to select) lead to a decrease in national income. b. A decrease in interest rates (Click to select) lead to a decrease in national income. c. A decrease in the money supply (Click to select) lead to a decrease in national income. d. An increase in the exchange rate (Click to select) e. A decrease in foreign incomes (Click to select) (Click to select) lead to a decrease in national income. lead to a decrease in national income. would would notarrow_forward
- You Suppose the government increases education spending by $20 billion. If the marginal propensity to consume is 0.75, how much will total spending increase? Instructions: Round your response to one decimal place. $ billionarrow_forwardThe government raises taxes by $100 billion. If the marginal propensity to consume is 0.8 What happens to the following? Do they rise or fall? By what amounts? a)Investmentarrow_forwardThe value of marginal propensity to consume is 0.44 Calculate the value of Marginal propensity to save?arrow_forward
- Do you think that the marginal propensity to consume out of current income differs between tenured professors who have a high degree of job security and professional gamblers who never know when luck will strike?arrow_forwardMonica's current income went up from $100.000 to $105,000 and she increased her current consumption by $2100. What is her marginal propensity to consume?arrow_forwardWhat is individual Marginal Propensity to Consume and Marginal Propensity to Save? please provide an example for each.arrow_forward
- What is the minimum value of multiplier?arrow_forwardThe marginal propensity to consume is 0.5. calculate the value of multiplier and marginal propensity to save.arrow_forwardAn increase in the marginal propensity to consume will make the spending multiplier ? An increase in taxes as a portion of income will make the spending mitltiplierarrow_forward
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