Multiple Choice
Suppose the MPC is 0.9.There are no crowding out or investment accelerator effects.If the government increases its expenditures by $30 billion,then by how much does aggregate demand shift to the right? If the government decreases taxes by $30 billion,then by how far does aggregate demand shift to the right?
A) $283 billion and $254.7 billion
B) $283 billion and $283 billion
C) $300 billion and $270 billion
D) $300 billion and $300 billion
Correct Answer:

Verified
Correct Answer:
Verified
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