Exhibit 11-3 -Refer to the Graph in the Exhibit.If the Government Wants

Multiple Choice

Exhibit 11-3

-Refer to the graph in the exhibit.If the government wants to increase equilibrium by $100 billion through a change in autonomous net taxes, autonomous net taxes might decrease.If the decrease occurs, what is the likely amount?  

A)  $100 billion 
B)  $100 billion × (1 - MPC) /MPC 
C)  $100 billion × MPC/(1 - MPC)  
D)  $100 billion × MPC/(MPC - 1)