MACROECONOMICS FOR TODAY
10th Edition
ISBN: 9781337613057
Author: Tucker
Publisher: CENGAGE L
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Chapter 8, Problem 11SQ
To determine
The MPC of the economy.
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If the marginal propensity to consume is 0.6 then the marginal propensity to save must be
0.4.
1.
1.4.
0.6.
When the value of average propensity to save is negative, then the value of marginal propensity to save will also be negative.
In the goods market when C(Yd) = c0 + c1Yd, the multiplier is bigger when:A. The marginal propensity to consume (c1) is smaller.B. The marginal propensity to consume (c1) is larger.C. The exogenous component of consumption (c0) is larger.D. The exogenous component of consumption (c0) is smaller.E. None of the above.
Chapter 8 Solutions
MACROECONOMICS FOR TODAY
Ch. 8.4 - Prob. 1YTECh. 8 - Prob. 1SQPCh. 8 - Prob. 2SQPCh. 8 - Prob. 3SQPCh. 8 - Prob. 4SQPCh. 8 - Prob. 5SQPCh. 8 - Prob. 6SQPCh. 8 - Prob. 7SQPCh. 8 - Prob. 8SQPCh. 8 - Prob. 9SQP
Ch. 8 - Prob. 1SQCh. 8 - Prob. 2SQCh. 8 - Prob. 3SQCh. 8 - Prob. 4SQCh. 8 - Prob. 5SQCh. 8 - Prob. 6SQCh. 8 - Prob. 7SQCh. 8 - Prob. 8SQCh. 8 - Prob. 9SQCh. 8 - Prob. 10SQCh. 8 - Prob. 11SQCh. 8 - Prob. 12SQCh. 8 - Prob. 13SQCh. 8 - Prob. 14SQCh. 8 - Prob. 15SQCh. 8 - Prob. 16SQCh. 8 - Prob. 17SQCh. 8 - Prob. 18SQCh. 8 - Prob. 19SQCh. 8 - Prob. 20SQ
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- When Ani’s income changes from $400 to $1000, her saving changes from $100 to $580. Ani’s Marginal Propensity to Consume =arrow_forwardIf the value of average propensity to save is -0.9 what will be the value of average propensity to consumearrow_forwardConsumption function C = 32 +0.8 Y. a. Create saving function b. How much is consumption when saving = 0 c. How much income when the savings are 20arrow_forward
- Assume in country Y, the average marginal propensity to save is 0.2. When the aggregateincome is zero, consumers spend 50 to consume. Derive the saving function and consumptionfunction for this country. What happens to consumption when the propensity to savedecreases to 0.1? Explain your answer and show this on the graph.arrow_forwardThe value of Marginal propensity the save is 0.28 Calculate the value of Marginal propensity to consumearrow_forwardIf a household’s income falls from R12 000 to R10 000, and its consumption falls from R9 500 to R8 000, then: The marginal propensity to consume is ‐0.8. The marginal propensity to consume is 0.75. The marginal propensity to consume is 0.2. The marginal propensity to save is 0.15.arrow_forward
- The marginal propensity to consume is 0.5. calculate the value of multiplier and marginal propensity to save.arrow_forwardSuppose the savings rate (s) in the economy is 30%, GDP is $1,000, and investment can be expressed as I=s*Y. Calculate the level of investment in this economy. Question 9 options: 1) $600. 2) $330. 3) $300. 4) $150.arrow_forwardIf a household’s income falls from R20 000 to R17 000 and its consumption falls from R18 000 to R15 000, thenits:a) marginal propensity to consume is –0,67.b) marginal propensity to consume is 0,88.c) marginal propensity to consume is 0,20.d) marginal propensity to save is zero.e) marginal propensity to save is 0,12.arrow_forward
- If you make $800 from a lucrative side business selling snack food in dorms, how much would you save if your marginal propensity to consume is 0.75? (do not include the dollar sign in your answer).arrow_forward1. The marginal propensity to consume is:A) the change in consumption divided by the change in income.B) consumption divided by income.C) the change in consumption divided by the change in saving.D) The change in saving divided by the change in income.arrow_forwardIf the public consumes $200 billion less and the government purchases $200 billion more (other things unchanging), which of the following statements is true? a. There is an increase in saving, and the economy should grow more quickly. b. Saving is unchanged.c. There is not enough information to determine what will happen to the saving. d. There is a decrease in saving, and the economy should grow more slowly.arrow_forward
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