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 decrease planned aggregate spending by $30 billion at any output level, government spending must be decreased by ________ or net taxes must be increased by ________.

A) $30 billion; $30 billion
B) more than $30 billion; more than $30 billion
C) less than $30 billion; less than $30 billion
D) $30 billion; more than $30 billion