Solved

Assume Autonomous Net Taxes Rise by $500; the Marginal Propensity

Question 34

Multiple Choice

Assume autonomous net taxes rise by $500; the marginal propensity to consume = 0.75.Net exports,planned investment,taxes,and government purchases are autonomous and remain fixed.As a result,equilibrium real GDP demanded will


A) rise by $500
B) fall by $500
C) rise by $1,500
D) fall by $1,500
E) rise by $2,000

Correct Answer:

verifed

Verified

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

Related Questions

Q29: If the multiplier for autonomous government purchases

Q30: An increase in net taxes<br>A)raises aggregate expenditure

Q31: Exhibit 11-5 <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB4914/.jpg" alt="Exhibit 11-5

Q32: Assume that initially G is $100 and

Q33: Assume autonomous net taxes fall by $300;

Q35: A $200 increase in government purchases has

Q36: Exhibit 11-5 <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB4914/.jpg" alt="Exhibit 11-5

Q37: Assume autonomous net taxes fall by $300;

Q38: Assume autonomous net taxes fall by $300;

Q39: If government purchases increase by $10 billion