In the Short-Run Keynesian Model, If the Mpc Equals 0

Multiple Choice

In the short-run Keynesian model, if the mpc equals 0.8, then to increase planned aggregate spending by $20 billion at any output level, government spending must be increased by ________ or net taxes must be decreased by ________.

A) $20 billion; $20 billion
B) more than $20 billion; more than $20 billion
C) less than $20 billion; less than $20 billion
D) $20 billion; more than $20 billion