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Macroeconomics 12th Edition by Michael Parkin
Edition 12ISBN: 978-0133872279Macroeconomics 12th Edition by Michael Parkin
Edition 12ISBN: 978-0133872279 Exercise 6
Use the following data to work Problem.
An economy has a fixed price level, no imports, and no income taxes. MPC is 0.80, and real GDP is $150 billion. Businesses increase investment by $5 billion.
Calculate the multiplier and the change in real GDP.
An economy has a fixed price level, no imports, and no income taxes. MPC is 0.80, and real GDP is $150 billion. Businesses increase investment by $5 billion.
Calculate the multiplier and the change in real GDP.
Explanation
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First, list the given data:
• Marginal p...
Macroeconomics 12th Edition by Michael Parkin
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