Multiple Choice
Assume that taxes depend on income. The MPC is 0.5 and t is 0.5. The government spending multiplier is
A) 1.33.
B) 2.
C) 2.5.
D) 4.
Correct Answer:
Verified
Correct Answer:
Verified
Related Questions
Q328: If government spending is increased by $550
Q329: Refer to the information provided in Table
Q330: Refer to the information provided in Table
Q331: Assuming there is no foreign trade in
Q332: [-(MPC/MPS)] is the formula for the<br>A) consumption
Q334: Refer to the information provided in Table
Q335: If the tax multiplier is -2.22, the
Q336: The economy is in equilibrium when aggregate
Q337: A decrease in lump-sum taxes will<br>A) make
Q338: The Canadian economy can be characterized by