Calculate marginal propensity to save

Reference no: EM1369811

Suppose that initially G is $100 and equilibrium real GDP demanded is $1,000. If the multiplier is 4 & G increases to $200, real GDP demanded will increase
a. by $100
b. by $2,000
c. by $1,000
d. to $1,400
e. to $2,000

If autonomous net taxes decline by $40 billion and the MPC = 0.75, then equilibrium real GDP demanded
a. declines by $120 billion
b. increases by $120 billion
c. declines by $160 billion
d. increases by $160 billion
e. increases by $40 billion

Assume autonomous net taxes rise by $400; the marginal propensity to consume = 3/4. Net exports, planned investment, taxes, and government purchases are autonomous and remain fixed. As a result, saving will initially
a. fall by $400
b. rise by $300
c. remain unchanged
d. fall by $100
e. rise by $100

Reference no: EM1369811

Questions Cloud

Find marginal cost of last unit produced : find marginal cost of last unit produced. What is firms percentage mark-up of price over marginal cost.

Which one should you sell care about rates of return : Selling stocks. Suppose you have two stocks A and B. One falls in price and or increases. If you only care about rates of return, which one should you sell?

Why would it be valuable for a business to know elasticity : Why would it be valuable for a business to know cross elasticity of demand for two products it produces: peanuts and popcorn.

Factors affecting market equilibrium : Due to severe damage, a gas pipeline supplying gas to Arizona was shut down for some weeks in summer of 2003. Gas became scarce in Arizona, and prices increase,

Calculate marginal propensity to save : Suppose that initially G is $100 and equilibrium real GDP demanded is $1,000. If the multiplier is 4 & G increases to $200, real GDP demanded will increase

Compute and present graphically equilibrium price : Assume that demand for oranges is given by the following equations, With quanity measured in oranges a day and price measured in dollars per Orange.

Explain how does performance management directly affect : Explain How does Performance Management directly affect the success of an organization

Quantity of equilibrium sales : Demand for refrigerators is often explained as cyclical and very sensitive to refrigerator prices & interest rates. Given these characteristics, explain the effect of each of the following in terms of;

Question on marginal benefit to consumers : Assume these customers live in Cuba and get a ration of 50 units of Q each month. What is the marginal willingness to pay at this level of consumption for each customers ?

User Account

All Pages