Solved

Suppose the MPC Is 0

Question 39

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:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions