For each of the following values for the MPC, determine the size of the simple spending multiplier

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For each of the following values for the MPC, determine the size of the simple spending multiplier and the total change in real GDP demanded following a $10 billion decrease in autonomous spending:

a. MPC = 0.9

b. MPC = 0.75

c. MPC = 0.6

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Modern Principles of Economics

ISBN: 978-1429278393

3rd edition

Authors: Tyler Cowen, Alex Tabarrok

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Question Posted: Aug 26, 2013 06:47 AM

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For each of the following values for the MPC, determine the size of the simple spending multiplier

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Simple Spending Multiplier 11MPC MPC Spending Mult...View the full answer

Modern Principles of Economics

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