MACROECONOMICS FOR TODAY
10th Edition
ISBN: 9781337613057
Author: Tucker
Publisher: CENGAGE L
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Question
Chapter 9, Problem 16SQ
To determine
The value of the spending multiplier.
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Suppose that the MPC is .75 and the MPM is .1. What is the size of the multiplier?
I'm doing economics homework and I'm being asked to find the multiplier when the MPS is 0.12 and MPC is 0.88. I'm trying to follow the formula and not sure where I'm getting lost.
If the marginal propensity to save (MPS) is 0.5, the multiplier will be
A.
2.
B.
2.5.
C.
0.5.
D.
4.
Chapter 9 Solutions
MACROECONOMICS FOR TODAY
Ch. 9.4 - Prob. 1YTECh. 9 - Prob. 1SQPCh. 9 - Prob. 2SQPCh. 9 - Prob. 3SQPCh. 9 - Prob. 4SQPCh. 9 - Prob. 5SQPCh. 9 - Prob. 6SQPCh. 9 - Prob. 7SQPCh. 9 - Prob. 8SQPCh. 9 - Prob. 9SQP
Ch. 9 - Prob. 10SQPCh. 9 - Prob. 1SQCh. 9 - Prob. 2SQCh. 9 - Prob. 3SQCh. 9 - Prob. 4SQCh. 9 - Prob. 5SQCh. 9 - Prob. 6SQCh. 9 - Prob. 7SQCh. 9 - Prob. 8SQCh. 9 - Prob. 9SQCh. 9 - Prob. 10SQCh. 9 - Prob. 11SQCh. 9 - Prob. 12SQCh. 9 - Prob. 13SQCh. 9 - Prob. 14SQCh. 9 - Prob. 15SQCh. 9 - Prob. 16SQCh. 9 - Prob. 17SQCh. 9 - Prob. 18SQCh. 9 - Prob. 19SQCh. 9 - Prob. 20SQ
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- What will the multiplier be when the MPS is 0, 0.4, 0.6, and 1? What will it be when MPC is 1, 0.90, 0.67, 0.50, and 0? How much of a change in GDP will result if firms increase their level of investment by 8 billion and the MPC is 0.80? If the MPC instead of 0.67?arrow_forwardAs the MPC rises, the multiplier falls does not change increases falls by .05 for each .01 increase in the MPCarrow_forwardIf an economy’s spending multiplier is equal to 4, what is its MPC and MPS?arrow_forward
- If the MPC is 0, then the multiplier is A. 1. B. 0. C. infinite. D. None of the above is correct.arrow_forwardIf the multiplier is 5, then the MPC is 0.05 0.5 0.6 0.8arrow_forward17. If the MPC were equal to zero, the expenditure multiplier would be * a. Less than zero b. zero c. between zero and one d. one e. greater than onearrow_forward
- Consumption = 115 + 0.6Y Investment = 550 What is the value of autonomous spending , the value of the multiplier and the equilibrium level of incomearrow_forwardFind the value of multiplier when MPC is equals to 0.70arrow_forwardThe value of multiplier is 1.35 Calculate the value of Marginal propensity to savearrow_forward
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